midterm2NOSOL2010

midterm2NOSOL2010 - Midterm 2 2010 Notes: 1. Use a...

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Midterm 2 2010 Notes: 1. Use a calculator where necessary. 2. Show your work, place your answers in the spaces provided and make use of the cheat sheet. 3. If you want to make any additional assumptions to simplify a problem, please state them clearly. 5. Keep verbal answers concise 5. There are 75 points in total (1 point per minute) Note: while the questions in this exam are loosely based on research, I have made up all of the numbers to keep things simple. 1
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Following the recent Supreme Court decision allowing unlimited spending by corporations and unions on behalf of candidates during election campaigns, you decide to run various analyses about the relationship between politics and money. Questions 1 and 2 concern this type of study. organizations associated with the pro-gun lobby depends on a Congress-member±s voting record and the Congress-member±s personal characteristics (gender and whether the person attended an Ivy League school). log( GUN DOLLARS ) = 0 : 023 (0 : 010) + 0 : 110 (0 : 040) INDEX + 0 : 205 (0 : 100) INDEX 2 + 0 : 600 (0 : 200) MALE ± 0 : 050 (0 : 025) IVY where the number of observations is 535 and the R 2 is 0.40 : Robust standard errors are in parentheses under (higher for more right-wing policies), while MALE and IVY are dummies equal to 1 if the member is male or attended an Ivy League college respectively. GUN DOLLARS are measured in thousands of dollars. creates no problems. (a) [3 points] In (approximate) percentage terms, what is the predicted di/erence in campaign contribu- tions from the pro-gun lobby between two members who are similar except that one attended an Ivy League school and one did not. [Note: make it clear who gets the lower contribution]. Predicted Di/erence: . ............................................................................................................. 2
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level? At the 1% level? Result: 10% level: SIGNIFICANT± NOT SIGNIFICANT 1% level : SIGNIFICANT± NOT SIGNIFICANT (c) [5 points] What is the approximate predicted di/erence (in percentage terms) in gun contributions between a member with an INDEX of 0.5 and a member with an INDEX of 0.6? Would you expect the approximation you used to be accurate for a change of this magnitude? Predicted Di/erence: .
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This note was uploaded on 08/03/2011 for the course ECON 139 taught by Professor Alessandrotarozzi during the Spring '08 term at Duke.

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midterm2NOSOL2010 - Midterm 2 2010 Notes: 1. Use a...

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