Module One Quiz STEP: 2 of 2 The measure of standard error can also be applied to the parameter estimates resulting from linear regressions. For example, consider the following linear regression equation that describes the relationship between education and wage: WAGE" 2 30 -l- 181 EDUC.' +54 where WAGE, is the hourly wage of person i (i.e., any specific person) and EDUC, is the number of yea rs of education for that same person. The residual 5', encompasses other factors that inuence wage, and is assumed to be uncorrelated with education and have a mean of zero. Suppose that after collecting a crosssectional data set, you run an OLS regression to ob o||owing parameter estimates: WAGE, = 10.1 + 6.1 EDUC, If the standard error of the estimate of p91 is 1.32, then the true value ofl lies between V and V . As the number of observations in a data set grows, you would expect this range to V in size. TOTAL SCORE: 112