Exercise 3. Using a sample of 1801 individuals, the following earning equation has been estimated In(earnings) = 7.06 + 0.15 educ+ 0.05 experience - 0.21 female (0.04) (0.14) (0.01) (0.01) R = 0.17, RSS = 100 where the standard errors are reported in brackets. 1. Which variables are significant? Explain 2. Interpret the coefficient estimate on female. 3. Interpret R. 4. Dropping experience and female from the equation gives: In(earnings) = = 6.71 + 0.16 educ (0.18) .01) R = 0.11, RSS = 140 Are experience and female jointly significant in the original equation at the 5% significance level? Please write: (i) the null and alternative hypothesis, (ii) test statistic, (iii) proper critical value, (iv) conclusion. Hint: F1,1801 = 3.81, F1,1797 = 3.86, F2,1801 = 3.01, F2,1797 = 3.51