B Brown
Econ 310
Fall 2016
EXERCISE 6
This exercise considers models of the starting salaries for graduates from law schools.
The data set used is a cross-section of law schools given in LAWSCH85.txt with the variable
descriptions in LAWSCH85.des. These f

50011409
'2
mm Spnng013
Answer ve of the following questions. You must mwer 6 or 7. The question we '
Wuslmd
equally. You have 2.5 hours. You may use a calculator. You may use three sides of 8.5 by n m
for cheat sheets. Brevity is recommended.
8. Brown
I.

Econ 310
B. Brown
Spring 2015
Final Exam Answers
Answer ve of the following questions. You must answer question 7. The question are weighted
equally. You have 2.5 hours. You may use a calculator. Brevity is recommended.
1. Answer true or false and state w

Econ 409
B. Brown
Spring 2013
EXERCISE 6
This exercise considers the estimation of the marginal propensity to consume and whether consumption decisions are made with reference to current income or permanent income as proposed
by Freidman. This parameter i

B Brown
Econ 510
Fall 2015
EXERCISE 7
Consider the following model of expeditures on health
Ei = 1 + 2 Yi + 3 Si + ui
(i)
where Ei is aggregate personal healthcare expediture in state i, Yi is aggregate personal
income, Si is aggregate number of seniors (

B Brown
Econ 310
Fall 2016
EXERCISE 3: Answers
Taking yi = GP Ai and xi = ACTi , we have the following calculations (b1 given below):
i
1
2
3
4
5
6
7
8
Total
Mean
yi
2.8
3.4
3.0
3.5
3.6
3.0
2.7
3.7
25.7
3.2125
xi
21
24
26
27
29
25
25
30
207
25.875
yi y xi

B Brown
Econ 510
Fall 2015
EXERCISE 4
The following table contains the ACT scores and the GPA (grade point average) for 8 college
students. Grade point average is based on a four-point scale and had been rounded to one
digit after the decimal. Perform the

B Brown
Econ 310
Fall 2016
Sample Midterm Exam I
Answer two questions from 1 to 4 and one question from 5 and 6 for a total of 3. The
questions are weighted equally. You have 75 minutes. You may use a calculator. The exam
is closed-book and closed notes b

B Brown
Econ 310
Fall 2016
Midterm Exam I
Answer two questions from 1 to 4 and one question from 5 and 6 for a total of 3. The
questions are weighted equally. You have 75 minutes. You may use a calculator. The exam
is closed-book and closed notes but you

B Brown
Econ 310
Fall 2016
EXERCISE 2
We are given the observed matrices
1
1
X=
1
1
1
.3 21
.1 21
.2 3 , y =
.5 3
.4 3
84
73
65
68
85
,
and the vector of random disturbances
u=
u1
u2
u3
u4
u5
1. Showing all the steps in your calculations, obtain the

B Brown
Econ 310
Fall 2016
EXERCISE 1
This an exercise in the theory and application of the normal approximation when the
underlying distribution is not normal. It also gives you an opportunity to refresh your
memory on how to conduct a hypothesis test an

B Brown
Econ 310
Fall 2016
EXERCISE 3
The following table contains the ACT scores and the GPA (grade point average) for 8
college students. Grade point average is based on a four-point scale and had been rounded
to one digit after the decimal. Perform the

B Brown
Econ 310
Fall 2016
EXERCISE 5
1. Determine the order of magnitude of each of the following sequences of real numbers,
as t :
(a) yt = t
(b) yt = 3 + t2
(c) yt = 3 + 1/t2
(d) yt = t + t1/2
(e) yt = (1 + 2t + t2 )/(1 + 2t2 )
2. Suppose xt i.i.d, E[x

An article in Technometrics (1974, Vol. 16, pp. 523-531) considered the following stack-loss data from a plant oxidizing am
For this problem, answers
X1
X2
x3
y
80
27
89
42
80
27
88
37
75
25
90
37
62
24
87
28
62
22
87
18
62
23
87
18
62
24
93
19
62
24
93
2

B Brown
Econ 310
Fall 2016
EXERCISE 7
This exercise considers the estimation of the marginal propensity to consume and whether
consumption decisions are made with reference to current income or permanent income as
proposed by Freidman. This parameter is i

B Brown
Econ 510
Fall 2015
EXERCISE 2
1. Determine the order of magnitude of each of the following sequences of real numbers,
as t :
(a) yt = t
(b) yt = 3 + t2
(c) yt = 3 + 1/t2
(d) yt = t + t1/2
(e) yt = (1 + 2t + t2 )/(1 + 2t2 )
2. Suppose xt i.i.d, E[x

Chapter 16
Nonlinear Regression
16.1
Model and Assumptions
16.1.1
Model
In the prequel we have studied the linear regression model in some detail. Such
models are linear with respect to the parameters given the explanatory variables
and have additive dist

Chapter 10
Multicollinearity
10.1
The Nature of Multicollinearity
10.1.1
Extreme Collinearity
The standard OLS assumption that ( xi1 , xi2 , . . . , xik ) not be linearly related
means that for any ( c1 , c2 , . . . , ck )
xik 6= c1 xi1 + c2 xi2 + + ck1 x

Chapter 6
Bivariate Least Squares
In economics we frequently encounter models where the relationship between
variables enables us to classify the variables into an independent variables which
are not modeled and and a dependent variable that is generated

B Brown
Econ 310
Fall 2016
EXERCISE 6: Answers
This exercise considers models of the starting salaries for graduates from law schools.
The data set used is a cross-section of law schools given in LAWSCH85.txt with the variable
descriptions in LAWSCH85.des

B Brown
Econ 510
Fall 2015
EXERCISE 3: Answers
This an exercise in the theory and application of the normal approximation when the underlying distribution is not normal.
1. Consider a Bernoulli random variable. Specifically X cfw_0, 1 and P r(x = 1) = and

Econ 409
B. Brown
Spring 2013
EXERCISE 5: Answers
Answers are in italics following the questions.
1. Duesenberry considered the following model for aggregate consumption:
Ct = + Dt + ut
where ut is an unknown disturbance term.
OLS regression
a. Run an OL

Practice Questions
1. Answer the following true or false questions. If true, please prove or
explain why it is correct. If false, please also state why. Sometimes one
counter example is sufficient to show a statement is wrong.
(a) Normality is required to

B Brown
Econ 510
Fall 2015
EXERCISE 6: Answers
This exercise considers the estimation of the marginal propensity to consume and whether
consumption decisions are made with reference to current income or permanent income
as proposed by Freidman. This param

B Brown
Econ 510
Fall 2015
EXERCISE 4: Answers
Taking yi = GP Ai and xi = ACTi , we have the following calculations (b1 given below):
i
1
2
3
4
5
6
7
8
Total
Mean
yi
2.8
3.4
3.0
3.5
3.6
3.0
2.7
3.7
25.7
3.2125
xi
21
24
26
27
29
25
25
30
207
25.875
yi y xi

B Brown
Econ 510
Fall 2015
EXERCISE 6
This exercise considers the estimation of the marginal propensity to consume and whether
consumption decisions are made with reference to current income or permanent income
as proposed by Freidman. This parameter is i