SW_2e_EE_ch05

# SW_2e_EE_ch05 - Chapter 5 Regression with a Single...

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Chapter 5 Regression with a Single Regressor: Hypothesis Tests and Confidence Intervals ± Solutions to Empirical Exercises 1. (a)  AHE = 3.32 + 0.45 × Age (0.97) (0.03) The t -statistic is 0.45/0.03 = 13.71, which has a p -value of 0.000, so the null hypothesis can be rejected at the 1% level (and thus, also at the 10% and 5% levels). (b) 0.45 ± 1.96 × 0.03 = 0.387 to 0.517 (c)  AHE = 6.20 + 0.26 × Age (1.02) (0.03) The t -statistic is 0.26/0.03 = 7.43, which has a p -value of 0.000, so the null hypothesis can be rejected at the 1% level (and thus, also at the 10% and 5% levels). (d)  AHE = 0.23 + 0.69 × Age (1.54) (0.05) The t -statistic is 0.69/0.05 = 13.06, which has a p -value of 0.000, so the null hypothesis can be rejected at the 1% level (and thus, also at the 10% and 5% levels). (e) The difference in the estimated β 1 coefficients is 1, ˆˆ College HighScool ββ −= 0.69 0.26 = 0.43. The standard error of for the estimated difference is SE () College HighScool = (0.03 2 + 0.05 2 ) 1/2 = 0.06, so that a 95% confidence interval for the difference is 0.43 ± 1.96 × 0.06 = 0.32 to 0.54 (dollars per hour). 2.  _ 4.00 0.13 Course Eval Beauty =+× (0.03) (0.03)

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## This note was uploaded on 06/05/2009 for the course ECON 140 taught by Professor Duncan during the Spring '08 term at Berkeley.

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SW_2e_EE_ch05 - Chapter 5 Regression with a Single...

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