Questions from General Economics

Q: Suppose you want to test whether girls who attend a girls’ high

Suppose you want to test whether girls who attend a girls’ high school do better in math than girls who attend coed schools. You have a random sample of senior high school girls from a state in the Un...

Q: Let {xt: t = 1, 2,…….} be a

Let {xt: t = 1, 2,…….} be a covariance stationary process and define

Q: Let {et: t = -1, 0, 1

Let {et: t = -1, 0, 1, ……} be a sequence of independent, identically distributed random variables with mean zero and variance one. Define a stochastic process by xt = et – (1/2)et-1 + (1/2)et-2, t = 1...

Q: Suppose that a time series process {yt} is generated by

Suppose that a time series process {yt} is generated by yt = z + et, for all t = 1, 2,…. , where {et} is an i.i.d. sequence with mean zero and variance σ2e. The random variable z does not change over...

Q: Let {yt: t = 1, 2,….} follow a

Let {yt: t = 1, 2,….} follow a random walk, as in (11.20), with y0 = 0. Show that for t ≥ 1, h > 0.

Q: For the U.S. economy, let gprice denote the

For the U.S. economy, let gprice denote the monthly growth in the overall price level and let gwage be the monthly growth in hourly wages. [These are both obtained as differences of logarithms: gprice...

Q: Let hy6t denote the three-month holding yield (in percent

Let hy6t denote the three-month holding yield (in percent) from buying a six-month T-bill at time 1t 2 12 and selling it at time t (three months hence) as a three-month T-bill. Let hy3t-1 be the three...

Q: A partial adjustment model is / where y*t

A partial adjustment model is where y*t is the desired or optimal level of y and yt is the actual (observed) level. For example, y*t is the desired growth in firm inventories, and xt is growth in firm...

Q: Use the data in MINWAGE for this exercise, focusing on the

Use the data in MINWAGE for this exercise, focusing on the wage and employment series for sector 232 (Men’s and Boys’ Furnishings). The variable gwage232 is the mon...

Q: Suppose that the equation / satisfies the sequential exogeneity assumption

Suppose that the equation satisfies the sequential exogeneity assumption in equation (11.40). (i) Suppose you difference the equation to obtain How come applying OLS on the differenced equation does n...