Reminder: This assignment will not be collected. Its purpose is to help you review the material we have covered in class and the text, but it is not to be viewed as an exhaustive list of topics/skills that you need to know.

Chp. 9
11.2 (try it by hand and using S-Plus), 11.6 (pp. 485-487); 11.22, 11.26a (p. 500)

Additional Problem (Use S-Plus)

Please find here some data on population density (pd) and vehicle thefts (vtt) per thousand residents in 18 Chicago districts (D). District 1 represents downtown Chicago. Run a regression with vtt as the dependent variable and pd as the independent variable. Plot the residuals against pd. Do you notice an outlier? If so, can you explain why it is so? If appropriate, delete any outliers and re-estimate the model.

Now test the hypothesis that the slope is zero against the alternative that it is different from zero. Use 1% as the level of significance. Also, give a 99% confidence interval for the slope.