Econometrics UE Past Papers Questions.


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(2701) Question Category: Mathematical Calculation

The average duration of unemployment (D) appears to increase when the unemployment rate (U) increases. Data were collected and run to test this hypothesis with regression analysis. Regression results are reported in the table below.

Regression analysis results- STATA.

Source SS df MS   Number of obs 11
        F(1,9) 32.7
Model 62.0025302 1 62.0025302 Prob>F 0.0003
Residual 17.0629282 9 1.89588091 R-Squared 0.7842
Total 79.0654584 10 7.90654584 Adj R-squared 0.7602
        Root MSE 1.3769
d Coef. Std.Err t P>t [95% conf. Interval]
u 2.469684 .4318592 5.72 0.000 1.49275 3.446617
-cons   2.056377 -0.03 0.980 -4.705918 4.597778
  1. Whatsign would you expect for hat{eta_{1}} and hat{eta_{0}} ? Why ?
  2. Are the results in the table above consistent with your priori hypothesis?
  3. What is the mathematical form of this case?
  4. Comment on overall results of the analysis?

Answer / Solution

UNSOLVED

(2702) Question Category: Mathematical Calculation

Using a sample of 1801 black individuals, the following earnings (E), equation has been estimated.

ln(hat{E}) =7.059 + 0.147 Education + 0.049Experience+0.201 female

(0.135)(0.008)   (0.007)  (0.036)

R^{2}=0.179; n=1801

Where the standard errors are reported in parenthesis.

  1. Using acceptable notations specify an econometric model that was estimated
  2. State all the assumptions underlying the estimation of the econometrics model specified in part (a) along with the problems that will be encountered if the assumptions are relaxed/ violated.
  3. Interpret the coefficient estimate on female.

In Answering part (d), you must write down

  1. The null and alternative hypothesis
  2. The test statistic
  3. The rejection rule
  1. Test the hypothesis that there is no difference in expected earnings between black women and black men. Test this hypothesis against a two-sided alternative, using the 5% significant level.

Answer / Solution

UNSOLVED

(2703) Question Category: Mathematical Calculation

Two distributions of data are being analyzed. Distribution A has a mean of 500 and a standard deviation equal to 100. Distribution B has a mean of 10 and standard deviation equal to 4. Which of the two distributions has a greater relative variation?

Answer / Solution

UNSOLVED

(2704) Question Category: Mathematical Calculation

Two distributions have the following characteristics:

Distribution A Distribution B
mu=45,600 mu=33.40
sigma=6,333 sigma=4.05

If a value from distribution A is 50,000 and a value from distribution B is 40, convert each value to a standardized z value and indicate which one is closer to its respective mean.

Answer / Solution

UNSOLVED

(2705) Question Category: Mathematical Calculation

Using your knowledge ANOVA complete all the missing values in the table below:

Analysis of variance for a simple regression model.

Source of variation Sum of square(SS) Degree of freedom (df) Mean square (MS)=(SS/df) F-statistic
Regression(ESS) 150.75      
Residual (RSS)   8    
Total(TSS) 300.40 9    
  1. Explain why the test statistic used in ANOVA should be F-statistic.
  1. Given this F-test what are numerator`s and denominator`s degree of freedom?

Answer / Solution

UNSOLVED

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