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A book publisher is interested in what makes a book successful. In order to answer this question the publisher provides you with a dataset of

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A book publisher is interested in what makes a book successful. In order to answer this question the publisher provides you with a dataset of books they have published in the last 5 years (PS2.dta). For each book this dataset contains information on the number of thousands of books sold (sales), the length of the book in number of pages (length), if the book was originally written in english (english = 1 if it was originally written in english, english = 0 otherwise) and whether the book is fiction or non-fiction (fiction = 1 if the book is fiction, fiction = 0 if the book is non-fiction). In order to analyze the data you first estimate the following population regression models: Sales = O0+ ailength + @2fiction + agenglish + U, (1)5. (20 points) Assume that Vor(U|length, fiction,english) = 02 x (length/500) where U is the error term of equation (1). Use this information to estimate equation (1) using Weighted Least Squares (in STATA if you need to perform a regression of y on x where you don't want to include the constant you can write the following: reg y x, noeons)

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