01 & 02 STAT HWA a - Dr. Valerie R. Bencivenga...

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Dr. Valerie R. Bencivenga Economics 329 PRACTICE HOMEWORK #1A: ANSWERS 1.a. discrete b. continuous c. discrete (dummy) d. discrete e. continuous (or approximately continuous) 2.a. Mode . It does not make sense to average nuclear power plants and hydroelectric plants. b. Median . This variable probably has a skewed distribution, with a small number of households having large net worth. The mean would be distorted by this small number of large values of the variable. c. Mean . There is no reason to think that this variable has a skewed distribution. d. Mean . There is no reason to think that this variable has a skewed distribution. But if, upon examining the data, it seems that a small number of workers work lots of overtime, and that this will distort the mean, then the median would be preferred. e. Median . This variable probably has a very skewed distribution, where a small number of very valuable homes would distort the mean. 3.a. millions of hours per year, or just millions of hours. b. 1/year or ―per year‖ if the growth rate is stated as a proportional growth rate, and %/year or ―percent per year‖ if the growth rate is stated in percentage points (or just unit-free). c. (millions of hours per year) 2 , or (millions of hours) 2 . d. millions of hour per year times billions of dollars per year, or just millions of hours times billions of dollars. e. unit-free. 4.a. The mean will increase, because a positive value is being added to the original set of deviations. b. The variance will increase. The variance is s n X X X i i n 2 2 1 1 1 ( ) . Obviously, if we add an observation whose value equals X , the variance declines, because the sum of squared deviations does not increase, and the denominator increases. However, the addition of a value above X will
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This note was uploaded on 09/28/2010 for the course ECO 329 taught by Professor Vicensa during the Fall '10 term at Academy of Design Tampa.

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01 & 02 STAT HWA a - Dr. Valerie R. Bencivenga...

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