# Ex01_answer_econ120b - Economics 120B Name Professor Yongil Jeon Summer 2006 Student ID Answer to Exam#1 – Summer 2006 Econometrics 120B 1-a(5

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Unformatted text preview: Economics 120B Name: _________________________ Professor Yongil Jeon Summer 2006 Student ID#: _________________________ Answer to Exam #1 – Summer 2006: Econometrics 120B 1-a. (5 points) Analyzing the behavior of unemployment rates across 150 different countries in July of 2006 is an example of using a. time series data. b. panel data. c. cross-sectional data. d. experimental data. Answer : c 1-b. (5 points) The least squares procedure minimizes the sum of A) the residuals. B) squared maximum error. C) absolute errors. D) squared residuals. Answer: D 1-c. (5 points) A residual is A) the difference between the mean of Y conditional on X and the unconditional mean. B) the difference between the mean of Y and its actual value. C) the difference between the regression prediction of Y and its actual value. D) the difference between the sum of squared errors before and after X is used to predict Y. Answer: C 1-d. (5 points) Income is used to predict savings. For the regression equation Y = 1,000 + .10X, which of the following is true? A) Y is income, X is savings, and income is the independent variable. B) Y is income, X is savings, and savings is the independent variable. C) Y is savings, X is income, and savings is the independent variable. D) Y is savings, X is income, and income is the independent variable. Answer: D 2 Answer to EXAM #1, ECON 120B, Summer 2006 2 2. (5 points) A multiple regression includes two regressors: i i i i X X Y ε β β β + + + = 2 2 1 1 What is the expected change in i Y if i X 2 decreased by 5 unites and i X 1 is unchanged? And what is the expected change in i Y if i X 1 increases by 3 units and i X 2 decreased by 5 unites? Answer If i X 2 decreased by 5 unites and i X 1 is unchanged, then i Y is expected to change by 2 5 β − units. If i X 1 increases by 3 units and i X 2 decreased by 5 unites, then i Y is expected to change by 2 1 5 3 β β − units....
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## This note was uploaded on 06/09/2010 for the course ECON 120B taught by Professor Jeon during the Spring '08 term at UCSD.

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Ex01_answer_econ120b - Economics 120B Name Professor Yongil Jeon Summer 2006 Student ID Answer to Exam#1 – Summer 2006 Econometrics 120B 1-a(5

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