(Answered) 1 refer to question 1 in the first part of assignment 2a

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1. Refer to question 1 in the first part of Assignment 2.

(a) Using LAD, estimate the parameters in the following model:

EXPENDi = M1 + M2AGEi + M3OWNRENTi + M4INCOMEi + M5INCOME2 i + Vi.

(HINT: Use the quantreg package for R.)

(b) Obtain standard errors of your estimates in part (a) using the Wild bootstrap with (B = 9, 999).

2. Replicate the illustration included in the file stoch-dom.pdf.1

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