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b ) Econometrician Mr . Spurious thinks that there is another factor f 3 , t , and runs the following regression r t =

b) Econometrician Mr. Spurious thinks that there is another factor f3,t, and runs the following regression
rt=+1f1,t+2f2,t+3f3,t+t
Are hat()1 and hat()2 in (3) unbiased estimators of 1 and 2 in model (1)? Are they consistent?
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