3 / 6 80% + Problem 3. Several authors have tried to measure the "persistence" in U.S state unemployment rates by running the following regression: Econ 213a-Fall 2022 2 I uri,t 01x uri,t-k+ zi,t where ur is the state unemployment rate, i is the index for the i-th state, t indicates a time period, and typically k 10. (a) Explain why finding a slope estimate of one and an intercept of zero is typically interpreted as evidence of "persistence." (b) You collect data on the 48 contiguous U.S. states' unemployment rates and find the following estimates: A uri,1995 2.25 +0.60 x uri,1970; R2 = 0.40, SER = 0.90 (0.61) (0.13) Interpret the regression results. (c) Analyze the accompanying figure, and interpret the observation for Maryland (MD) and for Washington (WA). Do you find evidence of persistence? How would you test for it? Graph 1: State Unemployment Rates 10 45 degree line and pipe or... D Comment rparer... Telas para soporta... CD Ventajas e Inconv... 3 / 6 80% + (c) Analyze the accompanying figure, and interpret the observation for Maryland (MD) and for Washington (WA). Do you find evidence of persistence? How would you test for it? Graph 1: State Unemployment Rates Unemployment Rate 199 10 9 8 NY RI ND 3