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Q2: Frisch-Waugh Theorem Please understand Equation 3.22 in the textbook 1. Use House data and report the multiple regression rprice = Bo + Bibaths +Bzage+u.

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Q2: Frisch-Waugh Theorem Please understand Equation 3.22 in the textbook 1. Use House data and report the multiple regression rprice = Bo + Bibaths +Bzage+u. Interpret 1. 2. Suppose the key regressor is baths. Please show the stata code and result that imple- ment the two-step procedure of the Frisch-Waugh Theorem to obtain i qui reg baths area qui predict rhat, r reg rprice rhat, nohe rprice Coef. Std. Err. t P>t| [95% Conf. Interval] rhat 6.12 24584.44 18602.52 83721.36 3040.477 1751.49 0.000 0.000 12620.6 80275.42 _cons 47.80 87167.29 reg rprice baths area, nohe rprice Coef. Std. Err. t P> [t] [95% Conf. Interval] baths 18602.52 2142.533 8.68 0.000 area 0.000 18.36728 1504.686 2.375508 4294.234 7.73 0.35 14387.19 13.69358 -6944.013 22817.85 23.04098 9953.386 _cons 0.726 Q2: Frisch-Waugh Theorem Please understand Equation 3.22 in the textbook 1. Use House data and report the multiple regression rprice = Bo + Bibaths +Bzage+u. Interpret 1. 2. Suppose the key regressor is baths. Please show the stata code and result that imple- ment the two-step procedure of the Frisch-Waugh Theorem to obtain i qui reg baths area qui predict rhat, r reg rprice rhat, nohe rprice Coef. Std. Err. t P>t| [95% Conf. Interval] rhat 6.12 24584.44 18602.52 83721.36 3040.477 1751.49 0.000 0.000 12620.6 80275.42 _cons 47.80 87167.29 reg rprice baths area, nohe rprice Coef. Std. Err. t P> [t] [95% Conf. Interval] baths 18602.52 2142.533 8.68 0.000 area 0.000 18.36728 1504.686 2.375508 4294.234 7.73 0.35 14387.19 13.69358 -6944.013 22817.85 23.04098 9953.386 _cons 0.726

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