Practice Exam 1

# Practice Exam 1 - Econ 120 C/Spring 2008 Instructor Jenny...

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1 Econ 120 C/Spring 2008 Instructor: Jenny Sun Practical Midterm 1 A. Multiple Choices (20%) Circle the letter for the best answer. 1) The interpretation of the slope coefficient in the model 01 ln( ) ii i YX u β = ++ is as follows: a. a 1% change in X is associated with a 1 % change in Y . b. a 1% change in X is associated with a change in Y of 0.01 1 . c. a change in X by one unit is associated with a 100 1 % change in Y . d. a change in X by one unit is associated with a 1 change in Y . Answer : b 2) The interpretation of the slope coefficient in the model ln( ) i u = is as follows: a. a 1% change in X is associated with a 1 % change in Y . b. a change in X by one unit is associated with a 100 1 % change in Y . c. a 1% change in X is associated with a change in Y of 0.01 1 . d. a change in X by one unit is associated with a 1 change in Y . Answer : b 3) The interpretation of the slope coefficient in the model ln( ) ln( ) i u = is as follows: a. a 1% change in X is associated with a 1 % change in Y . b. a change in X by one unit is associated with a 1 change in Y . c. a change in X by one unit is associated with a 100 1 % change in Y . d. a 1% change in X is associated with a change in Y of 0.01 1 . Answer : a

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2 4) The following interactions between binary and continuous variables are possible, with the exception of a. 01 2 3 () ii i i i i YX D X D u β βββ =+ + + × + . b. 2 i i i X D u ββ + × + . c. i i YD X u =++ + . d. 2 i i D u + + . Answer : c 5) The binary dependent variable model is an example of a a. regression model, which has as a regressor, among others, a binary variable. b. model that cannot be estimated by OLS. c. limited dependent variable model. d. model where the left-hand variable is measured in base 2. Answer : c 6) 11 ( | ,..., ) Pr( 1| ,..., ) kk EY X X Y X X == means that a. for a binary variable model, the predicted value from the population regression is the probability that Y =1, given X . b. dividing Y by the X ’s is the same as the probability of Y being the inverse of the sum of the X ’s. c. the exponential of Y is the same as the probability of Y happening. d. you are pretty certain that Y takes on a value of 1 given the X ’s. Answer : a 7) The linear probability model is a. the application of the multiple regression model with a continuous left-hand side variable and a binary variable as at least one of the regressors.
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## This note was uploaded on 03/26/2010 for the course ECON 120C 1 taught by Professor Sun during the Summer '08 term at UCSD.

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Practice Exam 1 - Econ 120 C/Spring 2008 Instructor Jenny...

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