Applied ECO

Econ 390-01

Midterm 1

Due date is Sunday, Oct 7th at 11:59 PM. Late submissions are not accepted. Mistakes in submissions are not accepted.

RULE: you can collaborate but there is a coefficient of 0.9 that will be multiplied by your score on this exam.

If you collaborate and do not inform me your score is 0.

Q1. (15/100) Show that .

Q2. (15/100) If then find in a sample of size 200.

Q3. (10/100) You take the Econometrics exam and score 80. The mean score for the test is 70 and the standard deviation is 5. If we assume the distribution of Econometrics score is normal, how well did you score on the test other test takers? (calculate your z-score first and find what percent of the test takers scored below you)

Q4. Suppose, according to a report, the average U. S. household spends 85 minutes per day watching TV. Suppose you recently took a random sample of 99 households in the U.S. and the results revealed a mean of 89 minutes. Suppose the standard deviation is known to be 10.50. Using a 0.05 level of significance,

a. (15/100) Can it be concluded that the average minutes spent per day by U.S. households has changed? (please provide 2 approached both the “T-test” and “P-value” approach. (You should write down the null, alternative, formulas, and provide your p-value on the z graph.)

b. (10/100) Create the 95 % Confidence Interval for the population mean using the information above? (Do not forget the complete formula of the interval)

Q5. Open the data “College Distance” and read the description, both are attached to this midterm exam:

a. (5/100) What is “ed” variable.

b. (5/100) How many variables and how many observations does this data include?

c. (5/100) What is “dist” variable? What is the unit of this variable?

d. (5/100) Provide a scatterplot in which ed is the dependent variable and dist is the independent variable.

e. (5/100) Provide a histogram for ed.

f. (5/100) Do you see any linear association in the previous plot?

g. (5/100) Find the correlation value, what does this number mean?