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(5) Given the following model, you suspect the presence of measurement error in the de- pendent variable on numcigs (the number of cigarettes smoked). numcigs
(5) Given the following model, you suspect the presence of measurement error in the de- pendent variable on numcigs (the number of cigarettes smoked). numcigs = Bo + Page + u, Let e denote the measurement error in numcigs. If both u and e are uncorrelated with age, given the following information, work out the the consequences of the mis- measurement of Numcigs. Var(numcigs) = 200, Var(age) =50, Cov(numcigs, age) = 100 Var(u) = 10, Var(e) = 10, Cov(u, e) = 2
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