Introduction to Econometrics 3rd Edition by James Stock, Mark Watson

Exercise 10

Use the estimated linear probability model shown in column (1) of Table 11.2 to answer the following:
a. Two applicants, one white and one black, apply for a mortgage. They have the same values for all the regressors other than race. How much more likely is the black applicant to be denied a mortgage
b. Construct a 95% confidence interval for your answer to (a).
c. Think of an important omitted variable that might bias the answer in (a). What is it, and how would it bias the results