First, properties of the conditional distribution Zi|Yi are established. These follow directly
from the model specification above. If Zi|Yi ⇠ Binomial(ni, Yi), then the conditional
expectation is E(Zi|Yi) = niYi and the conditional variance is V ar(Zi|Yi) = nYi(1 ! Yi)
by the properties of the binomial distribution. Then the conditional squared expectation is
E ⇥
(Zi)2|Yi
⇤
= niYi + ni(ni ! 1)Y 2
i .