Question 1 (1 point) 1. What is the correct expression for the following sum in summation notation? Xzy4 + X3V6 + X4Ve + XV10 + X6V12 + X7)14 O a) IM X2iVi Ob) Xjy zi Odr Xziyi 1=1 O d) IM- *; y zi Oe) None of the aboveQuestion 2 (1 point) What is the correct answer for the following sum? 2 3 EL(2 - 2y + 3x) x=1 y=2 O a) 23 Ob) 24 O c) 25 O d) 26 Oe) None of the aboveQuestion 3 (1 point) Suppose the following equation describes the relationship between annual salary (salary) and the number of previous years of labour market experience (exper): log (salary) = 10.5 + .03 exper By how much does salary go up when exper increases from 4 year to 6 years? O a) $ 2673.823 (b) $ 2548.729 O c) $ 2531.935 O d) $ 1376.312 Oe) none of the aboveQuestion 4 [1 point} Suppose that an additional year of schooling increases the logarithm of annual earnings from 11.55 to 11.60. Find the approximate percentage change in annual earnings due to an additional 4 years of schooling. Main Content 0 a} annual earnings increase by 0.02 96 O '3} annual earnings increase by 0.20 36 O 5} annual earnings increase by 2.00 96 O '3\" annual earnings increase by 20.00 96 O '3} annual earnings increase by 200.00 36 Question 5 (1 point) What is the percentage change in x in going from x1 to x2 (%Ax)? O a) 100(4x1/x) O b) 100(4x2/x) O c) 100(4x/x1) O d) 100(Ax/x2) Oe) none of the aboveQuestion 7 (1 point) You are organising an outdoor concert for next week and believe attendance will depend on the weather. You consider the following possibilities are appropriate: Weather Probability=f(x) Attendance=X Terrible weather 0.1 100 Normal weather 0.5 300 Good weather 0.3 700 Great weather 0. 1 1000 What is the variance of attendance? (a) 68100 O b) 69100 O c) 70100 O d) 71100 Oe) 72100Question 8 (1 point) "Charley Chicken" and "Bradley Bee" are brands of canned tuna. During a week a certain amount of advertising appears for these products. There may be no advertising, one form of advertising (newspaper coupon), or two forms of advertising (coupon and a special store display). Let C denote the level of advertising for Charley Chicken. It can take the values c=0, 1 or 2. Let B denote the level of advertising for Bradley Bee; B can take the values b=0, 1 or 2. Suppose the following table represents the joint probability distribution of the advertising levels for these two brands of canned tuna. Bradley Bee's Advertising: B 0 1 2 0 0.04 0.06 0.08 Charley Chicken's Advertising: C 0.06 0.16 0.18 2 0.08 0.12 0.22Find the marginal probabilities of f(b=1) and f(c=2). O a) f(b=1)=0.48 and f(c=2)=0.42 O b) f(b=1)=0.48 and f(c=2)=0.40 O c f(b=1)=0.40 and f(c=2)=0.48 O d) f(b=1)=0.42 and f(c=2)=0.34 Oe) f(b=1)=0.34 and f(c=2)=0.42Question 9 (1 point) "Charley Chicken" and "Bradley Bee" are brands of canned tuna. During a week a certain amount of advertising appears for these products. There may be no advertising, one form of advertising (newspaper coupon), or two forms of advertising (coupon and a special store display). Let C denote the level of advertising for Charley Chicken. It can take the values c=0, 1 or 2. Let B denote the level of advertising for Bradley Bee; B can take the values b=0, 1 or 2. Suppose the following table represents the joint probability distribution of the advertising levels for these two brands of canned tuna. Bradley Bee's Advertising: B 0 1 2 0 0.04 0.06 0.08 Charley Chicken's Advertising: C 1 0.06 0.16 0.18 2 0.08 0.12 0.22Find the marginal probabilities of f(b=2) and f(c=0). (a) f(b=2)=0.48 and f(c=0)=0.18. b) f(b=2)=0.18 and f(c=0)=0.48 O c) f(b=2)=0.42 and f(c=0)=0.18 O d) f(b=2)=0.18 and f(c=0)=0.42 O e) f(b=2)=0.42 and f(c=0)=0.48Question 10 (1 point) Which of the following statements is true for the standard normal distribution but not for other normal probability distributions with a positive expected value, i.e. E(X)>0? O a) it is symmetric around the mean O b) p(Xs1) = 1-P(X21)) O c) P(X=0)=P(X20) O d) P(XsE(X))=0.5 Oe) None of the above.Question 11 [1 point] Let X denote the length of life [in years} of a smart phone which is a normally distributed random variable with mean 2.5 years and variance of 4 years. According to this distribution what fraction of smart phones will last more than 4.5 years? 0 a} 0.3413 0 b} 0.3513 0 c} 0.3313 0 d} 0.153?r 0 e} 0.1337 Question 12 [1 point] The following table contains the data taken on the number of total study hours {HOURS} over the semester and the final marks {MARKS} obtained by ten students in an introductory;r econometrics unit at an Australian university. Estimating the relationship between MARKS and HOURS using a simple regression model of the form MARKS;=Bot B1HOURS;+u; produces that ( a) 95.68 % of the variation in MARKS is explained by the variation in HOURS ( b) 95.68 % of the variation in HOURS is explained by the variation in MARKS ( c) 91.86 % of the variation in MARKS is explained by the variation in HOURS (d) 91.86 % of the variation in HOURS is explained by the variation in MARKS O e) none of the aboveQuestion 13 [1 point) Assume that you have a sample of 20 observations for the random variables X and Y and wish to estimate the population regression function YE. = 3n + 3131+\"; using OLS. Suppose you calculate the following sums: 30; 173181 f') = 55. 2(21 if = 62, f = 4.5 and f = 55 Based on the above, what are the values for u and 31, respectively? 0 a} 1.33 and 0.6? O b} -o.33?1 and -0.3?90 0 cl -o.3?90 and 1.33?1 0 d} -o.3?90 and 0.88?1 0 '3} none of the above QuesLIVI 14 (1 PUITIL Consider the following regression output of a simple regression model, log(Y; )=Bo+B1X; + uj Dependent Variable: log(Y) Included observations: 92 Variable Coefficient Std. Error t-Statistic Prob. X 0.845153 0.002441 346.1739 0.0000 Constant (Intercept) 21.41795 3.718209 5.760287 0.0000 R-squared 0.899250 S.E. of regression 16.27776 Sum of squared residuals 23846.89 F-statistic 119836.4 Prob(F-statistic) 0.000000Using the above information, one can represent the sample regression function (SRF) of this regression as: a) , = 21.41795 + 0.845153 * X O b) , = 21.41795 + 0.845153 * X + u; O c) log (Y.) = 21.41795 + 0.845153* X d) log (Y,) = 21.41795 + 0.845153 * X + u; O e) log (Y); = 21.41795 + 0.845153 * XQuestion 15 [1 point] Consider the following scatter plot of two discrete variables X and Y {drawn to scale]. Based on the information conveyed by the plot, which of the following options represents the sample [estimated] regression line of Y on X and the sum squared residuals, Zz ? Figure 1. Scatter Plot of X and Y ? D I4 h! w # Ul m u m m CI M h O'I (II 10 12 14 16 ()a) p = 2.3475 - X,Ca =2.9189 ( b) Y = 2.3424 - 0.88X, Ed" = 0.3561 Ocp= 10.1351 - 0.6351X, Eu" = 2.9189 ( d) = 10.1351 + 0.6351X, Zu" = 2.9189 Oe) None of the aboveQuestion 16 (1 point) The following table contains the data taken on the number of total study hours (HOURS) over the semester and the final marks (MARKS) obtained by ten students in an introductory econometrics unit at an Australian university. Student MARKS HOURS 1 57 20 67 24 59 21 73 27 75 29 6 61 25 50 17 75 30 9 90 35 10 88 33 Estimating the relationship between MARKS and HOURS using a simple regression model of the form MARKS;=Bot B,HOURS;+u; predicts that a student with a total study hours of 28 will achieve a MARK of:Estimating the relationship between MARKS and HOURS using a simple regression model of the form MARKS;=Bot BjHOURS;+u; predicts that a student with a total study hours of 28 will achieve a MARK of: a) 75.9445 O b) 80.9445 O c) 83.9022 O d) 82.9445 Oe) 73.7184Question 1? [1 point] Suppose you estimate the following regression function of weekly Consumption expenditure for Milk [C] on weekly Income [M] based on a sample of 1000 Australian households. [Note: the yariables are measured in $]. 5 = 4+ 0.03534 Which of the following statements is true? 0 a} If Income increases by $1. households' Consumption of milk will decrease by 3.5 cents. O b} If Income is $0, households' Consumption of milk is also approximately $0. 0 c} If Income increases by $100. households' Consumption of milk increases by $35. 0 d} If Income decreases by $10000, households' Consumption of milk decreases by $450. 0 e} If income increases by $10. households' Consumption of milk will increase by 35 cents. Question 18 (1 point) You have estimated the following equation that describes the median housing price (in thousands of $) in a community that has air pollution (measured with Oxide for nitrous oxide) and the average number of bedrooms in the houses (Rooms): Log(PRICE,) = 10.35 - 0.778 * Log(Oxide;) + 0.714*Room; , n=208, R2=0.345 The first house in the sample, which is located in a community associated with a level of air pollution in log of 0.4 (i.e. Log(Oxide;)=0.4) and has 5 bedrooms, has been sold for $ 820,000. Which of the following statements is correct? ( a) The house has been sold at a price that is about $6,865 higher than what the model predicts. ( b) The house has been sold at a price that is about $6,745 higher than what the model predicts. ( c) The house has been sold at a price that is about $6,745 lower than what the model predicts0 d} The house has been sold at a price that is about $?,?45 higher than what the model predicts 0 e) The house has been sold at a price that is about $7345 higher than what the model predicts Question 19 [1 point) Suppose you are given the following data on sales. prices and advertising expenditures of a fast-food franchise in 10 different cities. \fQuestion 20 (1 point) Using a sample of 90 employees we obtain the results of the following multiple Main Content regression moder. Log(WAGE,) =3.5 + 0.15 *Education; + 0.11 *Experience; Std.err (1.2) (0.185) (0.09) where Wage, Education and Experience denote hourly wage, years of schooling and years of working experience, respectively. Which of the following statements is correct?Which of the following statements is correct? Oa) Of the two employees with the same level of experience, the one with one less year of schooling on average earns hourly wage that is approximately 15 % higher than the hourly wage earned by the other. Ob) Of the two employees with the same level of education, the one with an additional year of experience on average earns hourly wage that is approximately 0.11 % higher than the hourly wage earned by the other. Oc) Of the two employees with the same level of experience, the one with an additional year of schooling on average earns hourly wage that is approximately 11 % higher than the hourly wage earned by the other. Od) Of the two employees with the same level of education, the one with an additional year of experience on average earns hourly wage that is approximately 15% higher than the hourly wage earned by the other. Oe) Of the two employees with the same level of experience, the one with one less year of schooling on average earns hourly wage that is approximately 15 % lower than the hourly wage earned by the other