Hello everyone,

I have a question regarding a Stata coefficient.
Our professor told us to set obs = 100, generate 2 normally distributed variables (x with (1,2) and u with (0,1)) and y which equals y = 2 - 0.5*x + u. Then to regress y on x.

Now Stata gives us a biased coefficient, which is different every time we change the observations (thus not consistent).

We do not understand why it is not providing us with the correct coefficient. It must be somehow biased, but why??

I would really appreciate every help!

Thanks so much in advance,

Maja