7. The components of the OLS variances Under assumptions MLR.1 through MLR.5, conditional on the sample values of the independent variables, the variance of B; under OLS is: Var (6) = sen( ) ssr,(1-1E) where o = the variance of the error term SST; = the total sample variation of a; R = the R-squared from a regression of I, on all of the other explanatory variables, along with an intercept parameter The variance of Bj as R i ncreases. For the given model, which of the following would lead to a reduction of the sampling variance of B;? O using the same data set with the same number of observations O Choosing an explanatory variable Ik that is uncorrelated with the other explanatory variables in the model Adding irrelevant explanatory variables to the model that are correlated with a; Adding an explanatory variable that is equal to 5+1j

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