Solving Economical Math Questions.

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Just answer the questions and show the working out. One of the questions look like this: Past experience has shown that for every 100,000 items produced in a plant by the morning shift, 200 are defective, and for every 100,000 items produced by the evening shift, 500 are defective. During a 24-hour period, 1000 items are produced by the morning shift and 600 by the evening shift. What is the probability that an item picked at random from the total of 1600 items produced during the 24-hour period. a) Was produced by the morning shift and is defective? b) Was produced by the evening shift and is defective? c) Was produced by the evening shift and is not defective? d) Is defective, whether produced by the morning or the evening shift?

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BEC5005 Quantitative Methods II, WRIT1 Name & Student Number: __________________________________ Aims and learning outcomes: This project will enable you to apply econometrics using Eviews. On completion of this coursework, you will be able to analyse data, interpret the Eviews output and apply statistical analysis skills to your own research. Plagiarism Warning: If plagiarism is suspected, your project will receive close scrutiny. All projects found to contain identical text will receive a mark of zero. SUBMISSION INFORMATION (IMPORTANT): Your project should be word-processed and well-organised in the original word document. Download the data loan.xls and screenshot your results/graphs (with your unique workfile name yourstudentnumber.wf1 in each picture) as the answer to the question. Turnitin submission is required. Student Loan Project Scholarly literature indicates that the student loan awarded to students could be affected by the family income, student’s academic performance and the gender of the student. Use the data in loan.xls for the questions below. The data includes 4 variables: loani: student loan (measured in pounds of grant) awarded to the ith student incomei: family income (measured in pounds) of the ith student rankingi: The ith student’s academic performance, measured as a percentage (i.e. between 0 and 100) femalei: (1 if the ith applicant is a female and zero otherwise) 1. Create a new workfile and save it as yourstudentnumber.wf1. Please provide a screenshot as your answer. (Alternatively, describe how to create and save it if you use Eviews Student Lite Version) (5 marks) 2. Create a group with all 4 variables in it. Show the descriptive statistics of all the variables in one table and name it. Please provide a screenshot as your answer. (5 marks) 3. In the space provided below, hypothesize the relationship (positive (+), negative (-), or no relationship (N/A)) between loani and incomei, and the relationship between loani and rankingi. (5 marks) 4. Create 2 graphs to plot loan against income, and loan against ranking. Freeze and name both graphs. (10 marks) 5. Estimate the following equations using OLS regressions: loani = β1 + β2 income i + β3 rankingi + β4 femalei + u i (1) lnloani = β1 + β2 lnincome i + β3 lnrankingi + β4 femalei + u i (2) Report the results with 2 decimal points in the following tables (5 marks) Equation 1 Variable Coefficient Std error t-stat p-value constant income ranking female Equation 2 Variable Coefficient Std error t-stat p-value constant lnincome lnranking female 6. What is the value of r-square in equation (2)? How do you interpret it? (10%) 7. Using the output from equation (1), interpret the coefficient of income (with a 5% significance level ) (10 marks) 8. Using the output from equation (2), interpret the coefficient of lnincomei (with a 5% significance level ) (10 marks) Using the output from equation (2), report the confidence intervals for β4 at 99%? (5 marks) 9. Interpret the coefficient of femalei with a 5% significance level in equation (2). What do you think about the idea of including femalei if the significance level is 1%? (20 marks) 10. Suppose that you wanted to add a variable to equation (1) to measure whether there might be discrimination against people of colour. How would you define such a variable? Write down the new equation and discuss if you prefer a log form of the newly created variable. (15 marks)
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