Consider a dummy-variable regression model for the annual salary of school teachers in three different counties in southern California: Orange county (OC), LA county (LAC), and San Diego county (SDC). Let annual salaries of school teachers in these counties depend on years of experience and years of education. Assume that Y_iis annual salary, X_iis years of years of experience, and Z_iis the years of higher education, D_1i= 1 for LAC and D_1i=0 for SDC and OC, while D_2i=1 for SDC and D_2i=0 for LAC and OC.

Consider the following dummy variable regression model that allows us to find out school teachers in which county have the highest, second highest, and lowest annual salary when both years of experience and years of education are zero.

Y_i= b₁+ b₂X_i+ b₃Z_i+ b₄D_1i+ b₅D_2i+e_i

(i)Write down the estimated/fitted salary equation of the school teachers in each county.

(ii) State the condition/conditions under which school teachers in SDC will have the highest salary when both years of higher education and years of experience are zero