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Exercise 9-3 Algo Consider a binary response variable y and two predictor variables x1 and x2. The following table contains the parameter estimates of the
Exercise 9-3 Algo Consider a binary response variable y and two predictor variables x1 and x2. The following table contains the parameter estimates of the linear probability model (LPM) and the logistic regression model, with the associated p- values shown in parentheses. Variable LPM Logistic -0. 50 -1. 90 Intercept (0.02) (0. 06) 0 . 26 0. 99 *1 (0.06) (0. 06) -0 . 06 -0. 30 X2 (0. 01) (0. 04) a. At the 5% significance level, comment on the significance of the variables for both models. Variable LPM Logistic X1 Not significant Not significant X2 Significant Significant . . ...b. What is the predicted probability implied by the linear probability model for x1: 8 with x2 equal to 10 and 25? Note: Round intermediate calculations to at least 4 decimal places and final answers to 2 decimal places. Report the probability between 0 and 1 (not in '36). c. What is the predicted probability implied by the logistic model for x1: 8 with x2 equal to 10 and 25? Note: Round intermediate calculations to at least 4 decimal places and final answers to 2 decimal places. Report the probability between 0 and 1 (not in '36)
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