are106-homework-7 - , Econometrics Homework 7 ARE 106...

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, ARE 106 Econometrics Homework 7 Winter 2010 A. Havenner Data4-7 in Gretl provides 34 annual observations on coronary heart disease deaths and a number of related variables; see DatalRead info. Notice that Gretl is case sensitive, and these variables are all lower case. Use the Sample/Set range command to end the specification and estimation observations in 1975, reserving 1976-1980 for out-of-sample testing. Tests: 1. Using Gretl, estimate the parameters of a regression relating coronary heart disease to a constant, edible fat, meat, cigarettes, beer, and wine (in that order, for ease in grading). Do not use the other variables available in the dataset in this regression. [8] i) Report the results in standard format, and very briefly examine the model for plausibility. Are the signs of the variables as expected? Can you make any sense at all out of their magnitudes, e.g., how many more deaths per million population do you expect if everyone smokes 365 more cigarettes per year? [5] ii) Write the hypothesis tested in the "goodness of fit" F test, and formally draw a conclusion. iii) What else might you look at to determine whether this model is reasonable or not? [10] 2. Suppose meat is one-tenth fat. For the same regression specification as above, test the hypothesis that the coefficient on edible fat is equal to ten times the coefficient on meat using adirect t test. (You wi II need the coefficientcovariance matrix from the model Analys is tab.) Write the null and alternate hypotheses, the test statistic (show your calculations) and
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This note was uploaded on 03/18/2010 for the course ARE 106 taught by Professor Havenner during the Winter '09 term at UC Davis.

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are106-homework-7 - , Econometrics Homework 7 ARE 106...

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