Statistics and Data Analysis in Economics
Homework 12
Week of 11/29/99
- Reading Assignment:
Introductory Statistics for Business and Economics (ISBE)
- Chapters 11 & 12
- Problems (NOT to be turned in):
- 1) ISBE 11.1, 11.3, 11.5
- 2) ISBE 12.13
- 3) The relationship between cost (in hundreds of thousands
of 1976 dollars) and date of construction (measured in years after 1900)
for light water nuclear power plants manufactured in the U.S. appears
linear. Regression output for the regression of cost on date of
construction, obtained from SAS Insight, follows.
- a) Construct 95% confidence intervals for the slope and
intercept.
- b) Is the slope discernible from zero at the 5% error level?
Why/why not?
- c) Test the hypothesis (at the 5% error level) that average costs
increased by 10 million dollars per year over the time period under study.
About how large is the p-value associated with this test (0-1%,1-5%,5-10%,
10-20%,20-50%,50%+)?
- d) Estimate the model's error variance.
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last updated 24 November 1999