Test the hypothesis that the coefficients on daded79 and

Question

Step by step to solve the problem -

With this assignment you will find an Excel file called speeding.xlsx. This spreadsheet shows data from traffic citations in Massachusetts. For reference, the variables in this file are:

Amount = Assessed fine for the ticket

MPHover= Miles per hour over the speed limit

Age= Age of driver

a. Run the following regression: (Label this Model1)

Amount = β₀ + β₁ * MPHover + β₂ * age

b. At a level of α = .05, for which, if any, values of βi, would you reject the null hypothesis that β_i = 0? (If this applies, write your answer in the space below AND circle in the STATA output)

c. What percentage of the variation in amount of the fine is explained by the X-variables? (Write your answer below and underline in STATA output)

d. How much will the amount of a speeding ticket change as mph over the speed limit increases by 10 mph?

e. What is the predicted Amount with MPHover = 20, Age = 21?

Does height impact wage? With this assignment you will find an Excel file called wage96.xlsx. This spreadsheet shows data from young men and women who were 14-22 years old when they were first surveyed in 1979. These individuals were interviewed annually through 1994 and biannually since then. For reference, the variables that we will be using now are:

wage96 = Adult hourly wages (dollars) reported in 1996

height85 = Adult height (inches), self-reported in 1985

esteem80 = Score on Rosenberg Self-Esteem Scale as adolescent in 1980 (higher values = higher self-esteem)

daded79 = Father's years of education

momed79 = Mother's years of education

clubnum = Number of club memberships in high school (excludes athletics, academic/honor society clubs, & vocational clubs

f. Run the following regression: (Label this Model2A)

wage96 = β₀ + β₁ * height85 + β₂ * esteem80 + β₃ * daded79 + β₄ * momed79 + β₅ * clubnum

g. At a level of α = .10, for which, if any, values of β_i, would you reject the null hypothesis that β_i = 0? (If this applies, write your answer in the space below AND circle in the STATA output)

h. Test the hypothesis that the coefficients on daded79 and momed79 are jointly significant at a level of α=.05. Do this by (1) writing down the formula for the relevant F-statistic in the space below using the formula from class. Calculate it by running the appropriate restricted regression (this restricted version of the regression will be called Model 2B.) (2) Indicate the critical F-value below and make a decision about the hypothesis.

i. After calculating the F-statistic this way, run the appropriate STATA command to confirm your answer (the "short-cut" way discussed in class). Circle this in the STATA output.

j. Return to Model 2A. Using the original regression, test the hypothesis that all of the variables have a coefficient of zero (test of overall significance) at a level of α=.05. Do this by (1) writing down the formula for the relevant F-statistic in the space below using the formula from class. (2) Indicate the critical F-value and make a decision about the hypothesis.

k. Confirm your results by indicating that the STATA output shows the same answer (circle in the STATA output).

Attachment:- Assignment Files.rar