FinalProblems3 - Final Practice Problems - Econometrics...

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Unformatted text preview: Final Practice Problems - Econometrics 120A 1. The following is a fictional joint probability distribution for level of education and income. Level of education is in the left most row and income on the top most row. Education/Income 20,000 50,000 90,000 High School 4 25 4 25 2 25 College 6 25 6 25 3 25 (a) What is the probability that income is 20,000? What is the probability that income is 50,000? What is the probability that income is 90,000? (b) Conditional on having a High School education (but no College), what is the probability of having an income of 90,000? (c) Conditional on having a College education what is the probability of having an income of 90,000? (d) Are level of education and income independent? (e) A study argues that college graduates have higher incomes than people with only a high school degree. Do the numbers in the table support or contradict this claim? Fully justify your answer. 2. A researcher is trying to understand the expected level of income in the United States. Let X i be the level of income for person # i in his sample of 100 people.in his sample of 100 people....
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FinalProblems3 - Final Practice Problems - Econometrics...

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