(Answer available in Appendix D) We posit that the relationship between age and economic peril is nonlinear, but is this relationship the same for whites and blacks? Using the Economic Peril Index as your dependent variable, run four regression models:
1. recoded income and recoded age, using only white respondents
2. recoded income, recoded age, and age-squared, using only white respondents
3. recoded income and recoded age, using only black respondents
4. recoded income, recoded age, and age-squared, using only black respondents
Create a table that presents all four models. Then create a graph that shows the nonlinear relationships for both whites and blacks. For the graph values, hold income constant for whites at their mean of $68,000, and hold income constant for blacks at $42,000. Then address these questions: For which group is the relationship more nonlinear, and how can you tell this?