ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
expand_more
expand_more
format_list_bulleted
Related questions
Question
Transcribed Image Text:The following data is from a random sample of individuals who are 25 years old. Note, "wage" is the hourly earnings in US dollars, and "educ" is the years of education.
| i | wage | educ |
|---|------|------|
| 1 | 12.18 | 13 |
| 2 | 12.18 | 11 |
| 3 | 20.09 | 16 |
| 4 | 7.39 | 12 |
Consider the following model: \( \ln(\text{wage}) = B_0 + B_1 \text{educ} + u \).
Calculate the estimate of \( B_1 \). Round your answer to two decimal places.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by stepSolved in 3 steps with 3 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Similar questions
- A. It is known that the population of a community in 1995 was 230,000 people. The population continues to grow at an increasing rate for 5 years. In 2000 the population reached 300,000 people. The population continues to increase but the rate decreases until in 2007 the number reached 350,000 people. After that, the rate continued to decline for 3 years with a population of 320,000. The rate then rises again and the population reaches 280,000 in the long run.Represent this information in graphic form. B. Arteriosclerosis begins in childhood when plaque (a soft mass of fatty material) forms on the walls of arteries, blocking the flow of blood through the arteries. This can lead to heart attacks, strokes, and gangrene. If it is assumed that the aorta is cut in a cross section as shown in the figure, and has a radius of a cm in year t. Plaque thickness is assumed to be h = g(t). The open area is given by A = (a – h)^2 cm^2. What is the rate at which the area is decreasing due to plaque…arrow_forward4arrow_forward"In the regression model InY=b0+b1*InX+u, the coefficient b1 is interpreted as" O the intercept O A covariance O A regressor O An elasticityarrow_forward
- Suppose you have the following wage and education data for a sample with 3 observations: obs. no. 1 2 3 wage educ ($/hr) (years) 10.73 11 13.44 12 18.05 16 Calculate the coefficient for the regression of wage on education through the origin (i.e. ₁ in the model wage = B₁ educ). Express your answer out to B1 two (2) decimal points.arrow_forwardQuestion 18arrow_forwardINSUR A life insurance company wishes to examine the relationship between the amount of life insurance held by a family and family income. From a random sample of households, the company collected the accompanying data. The data are in units of thousands of dollars. INCOME 97 38 141 29 y = x = Let INSUR 280 75 INCOME 303 81 453 137 The numerator of the slope coefficient formula for the estimated regression equation is: 357 77 a 400,201.10 199 43 b 392,354.02 251 53 384,660.80 807 184 d 377,118.44 147 45 272 70 537 128 527 117 245 55 483 116 673 204 194 46 154 51 163 48 280 69 507 140 464 136 321 71 873 206 476 144 574 111 251 65 497 130 826 171 133 32 259 82 281 73 446 146 332 77 219 48 208 55 180 48 169 42 273 69 502 127 547 126 281 80 428 143 370 77 221 49 214 51arrow_forward
- E3arrow_forwardSelect the scenario which is an example of voluntary sampling. Answer Keypad Keyboard Shortcuts Tables An airline is interested in getting feedback about their on-board catering experience. They place a questionnaire in the pocket behind each airline seat for passengers to O fill out. An urban planner is interested in determining the traffic volume along a particular road. To estimate the traffic volume, he counts the number of cars that go by during the next 30 minutes. O To determine the mean domestic electricity consumption in the region, the electric company collects data from randomly selected households in the given region. A fitness center has 400 male clients and 300 female clients. They plan to buy new equipment, so they randomly select 80 male clients and 60 female clients and ask them what equipment they use the most.arrow_forwardConsider the population regression of log earnings [Y;, where Y,= In(Earnings,;)] against two binary variables: whether a worker is married (D₁, where D₁;= 1 if the th person is married) and the worker's gender (D2;, where D₂;= 1 if the th person is female), and the product of the two binary variables Y₁ = Po+B₁D₁+P₂D2i + P3 (D₁¡ × D₂i) + Hi- The interaction term: O A. indicates the effect of being married on log earnings. B. does not make sense since it could be zero for married males. C. allows the population effect on log earnings of being married to depend on gender. D. cannot be estimated without the presence of a continuous variable.arrow_forward
- Suppose we are interested in evaluating the impact on wages of being a college graduate and of residing in California. To this end we define the following dummy variables if college graduate if not college graduate coll = ncoll = if not college graduate if college graduate 1 cali = if residing in California S 1 if not residing in California ncali = if not residing in California if residing in California and for wages denoting yearly wages, we estimate the following model of returns to education wages = B1 coll+ B2ncoll + B3 cali + B4(coll x cali) + e where E[e|coll, cali] = 0. Which parameter or combination of parameters measures the increase in expected wages from obtaining a college degree (comparing to not having a college degree) when residing California? O a. None of the other options is correct O b. Bi – B2 O c. B1 – B2 + ß4 O d. B4 O e. Bi + B3 – ßi – B4 O f. Bi + B4 – ß2 – B4 Clear my choicearrow_forwardEconometrics Thomas Eisensee and David Stromberg wanted to measure how much news coverage of a foreign disaster impacted the amount of disaster relief provided by the U.S. government. They argue that the simple relationship would be biased. Let X = Minutes of News Coverage and Y= Disaster Aid. Choose a variable X2 that could bias the simple relationship. This variable should impact the amount of coverage and impact the amount of aid for reasons other than purely news coverage. Eisensee and Stromberg introduce an instrument Z = During the Olympics. Explain how Z could satisfy the relevant and exogenous criteria. Explain how you could use Z to estimate the impact of X on Y free from X2 bias. Hint: you should mention two stages.arrow_forwardSuppose the researcher considers the following model : Wage = Bo+B,Female + u, and runs OLS, using wage data on 250 randomly selected male workers and 280 female workers. The researcher has obtained the estimated equation as Wage = 15 (1.00) 3 Female, R = 0.05. (0.5) In the equation, Wage is measured in dollars per hour, Female is a binary variable that is equal to 1 if the person is a female and O if the person is a male. The numbers in the parentheses are the standard errors of the coefficients. Which Statement is NOT correct? The coefficient of Female, -3.00, is statistically significant at 5%. O The p-value for the test that Ho: B = 0, H : B 0 is less than 0.05. This regression may suffer omitted variable bias. R Since insignificant. is too low, the wage difference between men and women is The researcher can increase R- by including more regressors in the model.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSON
Engineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education