dataset is from: https://www.princeton.edu/~mwatson/Stock-Watson_4E/Stock-Watson-Resources-4e.html

CPS96_15

2.b. Compute the sample mean for average hourly earnings (AHE) in 1996 and 2015. (M1.5)

2.c. Compute the sample standard deviation for AHE in 1996 and 2015. (M1.5)

2.d. Construct a 95% confidence interval for the population means of AHE in 1996 and 2015. (M1.6)

2.e. Construct a 95% confidence interval for the change in the population means of AHE between 1996 and 2015. (M1.6)

2.f. Using your calculations from 2.b-2.e, complete the following table:

Table 1. Average Hourly Earnings, Nominal $'s

	Mean	SE(Mean)	95% Confidence Interval
AHE1996
AHE2015
	Difference	SE(Difference)	95% Confidence Interval
AHE2015 - AHE1996

2.g. In 2015, the value of the Consumer Price Index (CPI) was 237.0. In 1996, the value of the CPI was 156.9. Repeat (2.b-2.e) but use AHE measured in real 2015 dollars ($2015); that is, adjust the 1996 data for the price inflation that occurred between 1996 and 2015. (M1.5, M1.6)

2.h. Using your calculations from 2.g, complete the following table:

Table 2. Average Hourly Earnings, Real $2015

	Mean	SE(Mean)	95% Confidence Interval
AHE1996
AHE2015
	Difference	SE(Difference)	95% Confidence Interval
AHE2015 - AHE1996

2.g If you were interested in the change in workers' purchasing power from 1996 to 2015, would you use the results from (Table 1) or (Table 2)? Explain. (M1.6)

2.j. Using appropriate estimates, confidence intervals, and test statistics, answer the following question: Did real (inflation-adjusted) wages increase from 1996 to 2015? (M1.6)