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Whistler - Sample Final

# Whistler - Sample Final - ECONOMICS 326 Sample Final Exam...

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ECONOMICS 326 – Sample Final Exam Part 1 A data set has 51 quarterly observations on the unemployment rate in % (UN) and the unfilled job vacancy rate in % (V). After observation 32 a new unemployment benefits policy was introduced. A dummy variable D = 1 for the period when the new policy was effective and = 0 for the period before the new policy. Least squares estimation results with standard errors reported in parentheses are: Full sample period (observations 1, . . . , 51) N U ˆ = 3.319 - 2.003 V N = 51 SSE = 3.996 (0.192) (0.240) N U ˆ = 2.749 + 1.151 D - 1.529 V - 0.851 (D x V) N = 51 SSE = 0.843 (0.102) (0.317) (0.122) (0.429) Before the new policy (observations 1, . . . , 32) N U ˆ = 2.749 - 1.529 V N = 32 SSE = 0.225 (0.066) (0.079) After the new policy (observations 33, . . . , 51) N U ˆ = 3.900 - 2.381 V N = 19 SSE = 0.619 (0.427) (0.586) Clearly explain all answers . (1) [5 points] Test for the same regression in the two sample periods. What test statistic should you use ? Report a numerical test statistic. (2)

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Whistler - Sample Final - ECONOMICS 326 Sample Final Exam...

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