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The variable you left out · Part 1 of 3

The true model is $y = x_1 + 2x_2 + \varepsilon$ , with $\operatorname{Var}(x_1) = \operatorname{Var}(x_2) = 1$ and $\varepsilon$ independent of both regressors. The sample is large enough that estimates sit at their probability limits.

With $\operatorname{Cov}(x_1, x_2) = 0.5$ , you regress $y$ on $x_1$ alone. What slope do you estimate?

Answer with a number. Fractions, powers and expressions like 23/6 or C(52,5) are read correctly in practice.

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With $\operatorname{Cov}(x_1, x_2) = 0.5$ , you regress $y$ on $x_1$ alone. What slope do you estimate?