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Unformatted text preview: Economics 140A Fall 2011 Professor Startz Midterm Name: Student number: . Answer all 4 questions. Each question is worth 15 points, although some questions are easier than others. Be sure to show your work for each question. Please write your answers on the exam in the space provided after each question. Please clearly label the part of the question you are answering. Notice that there is some reference material provided after the questions. And some scrap paper too. You may use a calculator, but no other electronic devices. (No phones or laptops for example.) The exam is closed book. You may be asked to show your student id. page 2 1. This problem uses the CPS data that you are already familiar with from class. The following command was executed in Eviews: ls lnwage c log(hrswk) ed ed^2 union fe married The EViews output and the variance covariance matrix for the estimated coefficients are included below. Note that lnwage is the log of the wage rate, hrswk is hours worked, union equals 1 for a union member and zero otherwise, similarly for married. (One could also argue that it doesnt make sense to include hours worked in a least squares wage regressionbut lets not go there.) Dependent Variable: LNWAGE Method: Least Squares Date: 10/19/11 Time: 09:53 Sample (adjusted): 2 133092 Included observations: 91632 after adjustments Variable Coefficient Std. Error tStatistic Prob. C 0.244633 0.040696 6.011171 0.0000 LOG(HRSWK) 0.451298 0.006977 64.68759 0.0000 ED 0.038028 0.004787 7.944161 0.0000 ED^2 0.005912 0.000181 32.69902 0.0000 UNION 0.185646 0.065952 2.814874 0.0049 FE 0.194109 0.005751 33.75064 0.0000 MARRIED 0.387396 0.005829 66.45812 0.0000 Rsquared 0.253710 Mean dependent var 2.648679 Adjusted Rsquared 0.253661 S.D. dependent var 0.985454 S.E. of regression 0.851343 Akaike info criterion 2.516073 Sum squared resid 66408.41 Schwarz criterion 2.516793 Log likelihood 115269.4 HannanQuinn criter. 2.516292 Fstatistic 5191.501 DurbinWatson stat 1.816482 Prob(Fstatistic) 0.000000 coefficient covariance matrix C LOG(HRSWK) ED ED^2 UNION FE MARRIED C 0.001656 0.000171 0.000151 5.43E06 3.76E06 3.46E05 8.72E06 LOG(HRSWK) 0.000171 4.87E05 4.86E07 5.37E08 2.29E06 7.42E06 5.06E06 ED 0.000151 4.86E07 2.29E05 8.45E07 9.77E07 8.19E07 1.88E06 ED^2 5.43E06 5.37E08 8.45E07 3.27E08 7.82E08 1.13E08 9.79E08 UNION 3.76E06 2.29E06 9.77E07 7.82E08 0.004350 2.26E06 4.91E07 FE 3.46E05 7.42E06 8.19E07 1.13E08 2.26E06 3.31E05 1.54E06 MARRIED 8.72E06 5.06E06 1.88E06 9.79E08 4.91E07 1.54E06 3.40E05 page 3 A) Interpret the coefficient on log(hrswk). B) What log(wage) would you predict for an unmarried male with 12 years of education who works 40 hours a week and is a member of a union?...
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This note was uploaded on 12/26/2011 for the course ECON 140a taught by Professor Staff during the Fall '08 term at UCSB.
 Fall '08
 Staff
 Economics

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