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Question: hint it may be useful to begging by deriving the...

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8 Suppose that the true model is but Q is measured with measurement error r, the observed variable being Y Q+r It may be assumed that r has zero mean and constant variance, and that it is distributed independently of Q and X. Determine the consequences of the mea- surement error for the estimation of B2
Hint: it may be useful to begging by deriving the OLS estimator of Beta2 (and then obtaining it’s variance) in the model without measurement error, before determining the consequences of the measurement error for the estimation of Beta2
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