Final Exam Intro to Econometrics ECO5350
Questions:
8.16 Do question a) twice. Run first the regression with regular standard errors, then report the regression with robust standard errors. Comment on the difference. The errors are the same on both regressions, so you only need to save once.
Test for heteroskedasticity using a white test. Be sure to conclude. Report the regression needed for the test (the one with the errors squared as the dependent variable).
Obtain GLS estimates. 7.17 Only c and d.
7.24 Only c. Interpret the treatment effect, what is the effect of the policy on prices and number of units available?
Note: This is a ¡®natural experiment¡¯. D is the equivalent to what we called in class ¡®After¡¯ and IZLAW are the ¡®treated¡¯ areas. There are 2 separate y variables (price and units), hence you are running two different regressions, both with the same set of explanatory variables. To understand an effect in a market equilibrium in economics, you need to know what happened to both price and quantity.
Instructions:
– Turn in the printed exam in my office within 30 minutes after the start of the Final Exam for your section.
– Organization is important. I will not look for answers all over your exam. If I do not understand what something is, I will ignore it. Answer questions in the order they are asked above.
– This is a final exam. You are to work on your own. Your last page in the exam MUST be the statement in the following page, signed.
– Print the output given in stata of all the regressions that you are asked to run.
Please sign the following statement:
I understand that this computer-based exam is to be solved individually. I will not seek help from any other person, or assist any of my classmates. I understand that if I behave in way contrary to SMU¡¯s honor code, my actions will be reported to the university and my total grade for this exam will be zero.
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