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Shivali Gupta
Economics 10
Assignment 5
Hansford
Section 004
1.
2.
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50000
100000
150000
0
1000000
2000000
3000000
4000000
challenge spending in 1994 dollars
$$$ given the incumbent by his/her party
Fitted values
Commands:
regress partymoney chspend
twoway (scatter partymoney chspend) (lfit partymoney chspend)
a.)
The coefficient estimate for the amount of money spent on the campaign by the candidate challenging
the incumbent (chspend) is .0462434. The coefficient estimate means that for every dollar spent the
amount of campaign contributions that an incumbent member of the House of Representatives receives
from his or her political party increases by $.0462434. Yes, I can reject the null hypothesis that this
coefficient is zero, because the pvalue is significantly smaller than the preset alpha level of 0.05. This
coefficient estimate represents that the amount of money spent on the campaign by the candidate
challenging the incumbent has an impact on the amount of campaign contributions that an incumbent
member of the House of Representatives receives from his or her political party.
b.) The value of the Rsquared is 0.4068 for this model. The Rsquared value of 0.4068 represents that
about 41% of variations in partymoney is explained by chspend.
c.) The observation that fits the model least well, or in other words the outlier that is most noticeable, is
the variable for Acevedo where the candidate challenging the incumbent spent $368251.97 but only
received $15615.29 from his/her party.
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This note was uploaded on 07/02/2010 for the course ECON 10 taught by Professor Thomas during the Spring '10 term at UCM.
 Spring '10
 Thomas
 Economics

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