Midterm 1  Form B  Spring 2009
Economics 203
Instructors: Petry and Sahakyan
Name:
Before beginning the exam, please verify that you have 18 pages with 43 questions in
your exam booklet. You should also have a decisiontree and formula sheet provided
to you. Please include your full name and NetID on your bubble sheets. Based
on the name of your TA or discussion time, please code in the following for the
“Section” portion on your scantron:
TA Name
Discussion Day and Time
Section
Joshua Brown
Thursday 9am
00001
Joshua Brown
Thursday 10am
00002
Joshua Brown
Thursday 11am
00003
Mahdi Rastad
Thursday 12pm
00004
Mahdi Rastad
Thursday 1pm
00005
Mahdi Rastad
Thursday 2pm
00006
Meenakshi Ghosh
Friday 8am
00007
Meenakshi Ghosh
Friday 9am
00008
Sascha Baghestanian
Friday 10am
00009
Sascha Baghestanian
Friday 11am
00010
Soroush Ghazi
Friday 12pm
00011
Soroush Ghazi
Friday 1pm
00012
Hilal Atasoy
Friday 2pm
00013
Hilal Atasoy
Friday 3pm
00014
Paul Holmes
Friday 4pm
00015
Paul Holmes
Friday 5pm
00016
Good luck!
1. You would like to measure the proportion of people who will respond to a particular survey.
From previous surveys of this type you estimate the response rate to be 0.28. How many of
this survey must you send out to be 95% conﬁdent of being within 0.05 of the true response
rate?
z
0
.
10
= 1
.
282
z
0
.
05
= 1
.
645
z
0
.
025
= 1
.
960
a. 219
b. 271
c. 310
d. 385
e. 1240
1
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View Full Document2. Suppose you perform a test of the null hypothesis
H
0
:
σ
2
= 10 versus the alternative
hypothesis
H
1
:
σ
2
6
= 10. You obtain a pvalue of 0.014 for the test. Now consider forming
a conﬁdence interval for the true population variance, using the same data. Among the
following, which is the widest conﬁdence interval not containing 10?
a. A 99% conﬁdence interval
b. A 98% conﬁdence interval
c. A 97% conﬁdence interval
d. A 95% conﬁdence interval
e. All of the above will contain 10
3. You would like to form a 90% conﬁdence interval for the average income of UIUC philosophy
graduates. A previous study suggests that the standard deviation of philosophy graduates’
salaries is around $12000. You would like the interval to be no more than $3000 wide. How
many people should you sample?
z
0
.
10
= 1
.
282
z
0
.
05
= 1
.
645
z
0
.
025
= 1
.
960
a. 26
b. 27
c. 43
d. 44
e. 62
4. You believe that the scholarship athletes will have a lower GPA compared to the average
student. To prove your claim, you obtain transcripts of 32 scholarship athletes, and calculate
their average GPA to be 2.96 with a standard deviaion of 0.58. You remember reading in
the Daily Illini that the average UIUC GPA was 2.83. If you were to run a hypothesis test
of
H
0
:
μ
A
= 2
.
83 versus the alternative
H
1
:
μ
A
<
2
.
83, in what range would your pvalue
(
p
) lie?
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 Spring '10
 Petry
 Economics, Normal Distribution, Variance, Null hypothesis

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