1) The correlation coefficient (r) calculated between the quantity of cars produced (Q) and the cost per unit (ATC) is -0.11. Based solely on this information, what can you conclude about the relationship between Q and ATC. Explain in 1-2 sentences only.
2) Using the table below, calculate the correlation between Age and weight.
|
Age
|
Weight
|
|
36
|
140
|
|
27
|
160
|
|
36
|
180
|
|
21
|
120
|
3) What is the difference between a 20 percent increase in the price level and a 20 percentage point increase in the price level? Give numerical examples to support your explanation.
4) Does correlation imply causation? Explain.
5)
The histogram above is skewed to the left. Based on the picture above, what can you conclude between the relationship (i.e., which is greater) between the mean, the median and the mode? (5 points) No explanation is necessary.
6.
|
|
Coefficients
|
Standard Error
|
t Stat
|
P-value
|
|
Intercept
|
0.498119955
|
0.535514776
|
0.93017
|
0.35684304
|
|
income
|
0.055573106
|
0.003293109
|
16.87558
|
4.7045E-22
|
The Table above shows the regression results for the model:
TRAVEL = α + β INCOME + ε
Where TRAVEL is the travel expense of an individual (in $) in the sample in 2005 and INCOME is the individual's income (in $) in 2005.
a. What sign would you expect α? Explain in 2 sentences or less.
b. Given the regression results, interpret α and β.
c. Is the coefficient for INCOME statistically significant from zero at the 1% level? Explain.
7. ANOVA Significance
|
|
df
|
|
SS
|
MS F
|
F
|
|
Regression
|
|
1
|
2424.220154
|
2424.22 284.78505
|
4.7045E-22
|
|
Residual
|
|
49
|
417.1103349
|
8.512456
|
|
|
Total
|
|
50
|
2841.330489
|
|
|
Using the ANOVA table, calculate the R-squared.
Is the R-squared significantly different from zero? Explain how you arrived at that conclusion.
8. Laspeyres Price Index:
|
|
Price per lb. 2007
|
Qty. bought in 2007
|
Price per lb. 2008
|
Qty. bought in 2008
|
|
Onions
|
$ 2.05
|
3
|
$ 2.09
|
4
|
|
Garlic
|
$ 4.50
|
8
|
$ 4.80
|
7
|
|
Potatoes
|
$ 0.75
|
9
|
$ 0.65
|
8
|
Calculate the inflation rate between 2007 and 2008. Use the Laspeyres Price Index with 2008 as the base year.