Earnings of Mexican street vendors. Detailed interviews were conducted with over 1,000 street vendors in the city of Puebla, Mexico, in order to study the factors influencing vendors' incomes (World Development, February 1998). Vendors were defined as individuals working in the street, and included vendors with carts and stands on wheels and excluded beggars, drug dealers, and prostitutes. The researchers collected data on gender, age, hours worked per day, annual earnings, and education level. A subset of these data is in STREETVEN.csv.

a. Here is a first-order model statement for mean annual earnings, E(y), as a function of age (x1) and hours worked (x2).

E(y) = beta0 + beta1(age) + beta2(hours)

Hint: Write a lm equation and see the results using Summary() function.

b. Estimate and write out the least squares prediction equation.