In Example 7.12, we estimated a linear probability model for wh... | Filo

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C8 Use the data in LOANAPP for this exercise. The binary variable to be explained is approve, which isequal to one if a mortgage loan to an individual was approved. The key explanatory variable is white, adummy variable equal to one if the applicant was white. The other applicants in the data set are blackand Hispanic.To test for discrimination in the mortgage loan market, a linear probability model can be used:approve = β0 β1 white other factors.(i) If there is discrimination against minori

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