Questions from Econometrics

Q: Seven hundred income-earning individuals from a district were randomly selected

Seven hundred income-earning individuals from a district were randomly selected and asked whether they are government employees (Govi = 1) or not (Govi = 0); data were also collected on their gender (...

Q: Seven hundred income-earning individuals from a district were randomly selected

Seven hundred income-earning individuals from a district were randomly selected and asked whether they are government employees (Govi = 1) or not (Govi = 0); data were also collected on their gender (...

Q: Use the estimated probit model in Equation (11.8)

Use the estimated probit model in Equation (11.8) to answer the following questions: a. A black mortgage applicant has a P/I ratio of 0.35. What is the probability that his application will be denied?...

Q: Repeat Exercise 11.6 using the logit model in Equation (

Repeat Exercise 11.6 using the logit model in Equation (11.10). Are the logit and probit results similar? Explain. Data from Equation 11.10: Data from Exercise 11.6: Use the estimated probit model i...

Q: Consider the linear probability model Yi = 0 + 1Xi

Consider the linear probability model Yi = 0 + 1Xi + ui, and assume that E (ui | Xi) = 0. a. Show that Pr (Yi = 1 | Xi) = 0 + 1Xi. b. Show that var (ui | Xi) = (0 + 1Xi) [1 – (0 + 1Xi)]. c....

Q: Use the estimated linear probability model shown in column (1)

Use the estimated linear probability model shown in column (1) of Table 11.2 to answer the following: a. Two applicants, one self-employed and one in salaried employment, apply for a mortgage. They ha...

Q: Suppose Yi, I = 1, 2, …, n is

Suppose Yi, I = 1, 2, …, n is i.i.d. random variables, each distributed N (20, 4). a. Compute Pr (19.6

Q: This question refers to the panel data IV regressions summarized in Table

This question refers to the panel data IV regressions summarized in Table. a. Suppose the federal government is considering a new tax on cigarettes that is estimated to increase the retail price by $0...

Q: Two classmates are comparing their answers to an assignment. One classmate

Two classmates are comparing their answers to an assignment. One classmate has specified an instrumental variable regression model Yi = 0 + 1Xi + 2Wi + ui, using Zi as an instrument. The other stud...

Q: Consider the regression model with a single regressor: Yi = 

Consider the regression model with a single regressor: Yi = 0 + 1Xi + ui. Suppose the least squares assumptions in Key Concept 4.3 are satisfied. a. Show that Xi is a valid instrument. That is, show...