Answer all the attached questions;

Let the following model describe the true relationship between variables y, I and z: y = Bo+ B+ Bzz + u (1) 1. (5 points) Assume availability of a sample (y;, I;, 2;), i = 1, . .., n. Discuss under which conditions the OLS estimates of 8, and 8, are unbiased.2. (3 points) Suppose we are particularly interested in estimating 8, but we only have information on a random sample for (yi, r;), i = 1, ..., n. Under which conditions would it be correct to estimate the model y = Bot Batu?Onno owns a ship worth 500 million Euro. With a probability of p = 0.1, the ship sinks and its worth becomes 0. Onno is risk loving. (No more specific information on his risk attitudes is available.) Would he sell the ship for 475 million Euro