7.11 Th e data in Table 7.22 are an extract from the well-known study of Mauldin and Berelson.42 Th e variables are setting (an index of social setting), eff ort (an index of family planning eff ort), and change (the percentage decline in the crude birth rate) between 1965 and 1975 for 20 countries in Latin America.

(a) Develop a suitable model relating change to setting and eff ort.

(b) Since the data are cross-sectional, heteroscedasticity may be suspected. See if this is case. Show the test(s) you use.

(c) Do you suspect outliers in the data? If so, provide a formal test of the outliers.

(d) How would you reestimate the initial model, taking into account the problems encountered in

(b) and (c)? Show the necessary output.