sample final.201-FALL '10

# sample final.201-FALL '10 - Version DO NOT TURN THE PAGE...

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Name_______________________ Multiple-choice questions (3 points each): Clearly mark the best answer in pencil on your SCANTRON sheet. 1. Which of the following is the best interpretation of b 2 in this equation: 2 1 ln 25 . 0 4 . 2 01 . 1 ˆ X X Y - + = a. A 1 unit increase in X 2 causes a 0.25 unit decrease in Y, holding X 1 constant. b. A 1% increase in X 2 causes a 0.0025 unit decrease in Y, holding X 1 constant. c. A 1 unit increase in X 2 causes a 25% decrease in Y, holding X 1 constant. d. A 1% increase in X 2 causes a 0.25% decrease in Y, holding X 1 constant. 2. Using the equation below, determine what the likely direction of bias is in the estimate slope coefficient caused by omitting “years of experience” ( exp) if it is a relevant variable. univ wage 066 . 0 121 . 2 ) ( ˆ ln + = where wage = hourly wage and univ = number of years attended at 4-year university or college a. Negative because exp and wage are likely negatively correlated and exp and univ are likely positively correlated. b. Negative because exp and wage are likely positively correlated and exp and univ are likely negatively correlated. c.
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sample final.201-FALL '10 - Version DO NOT TURN THE PAGE...

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