Introductory Econometrics 4th Edition by Jeffrey Wooldridge

Exercise 8

Suppose that at a large university, college grade point average, GPA, and SAT score, SAT, are related by the conditional expectation E(GPA|SAT) =.70 +.002 SAT.
(i) Find the expected GPA when SAT = 800. Find E(GP|SAT = 1,400). Comment on the difference.
(ii) If the average SAT in the university is 1,100, what is the average GPA (Hint: Use Property CE.4.)
(iii) If a student's SAT score is 1,100, does this mean he or she will have the GPA found in part (ii) Explain.