2. (2) Consider the wage equation In(wage) A+BEDUC + B,EDUC +B,EXPER+B,EXPER+B.(EDUC EXPER)+e where the explanatory variables are years of education (EDUC) and years of experience (EXPER). Estimation results for this equation, and for modified versions of it obtained by dropping some of the variables, are displayed in Table 6.10 (see Table6 10.pdf in Canvas). These results are from 200 observations in the file cps5 small. Use a 5% level of significance for all tests. a) Use an F-test and the results in Eqn (A) and Eqn (B) to test H,: B-0. b) Use an -test and the results in Eqn (A) to test H: B, -0. Show that r-F obtained in part a). e) Use an F-test and the results in Eqn (A) and Eqn (C) to test H,: B,-B,-B.-0. d) Use an F-test and the results in Eqn (B) and Eqn (D) to test H,: B, -B,-0. e) Use an F-test and the results in Eqn (A) and Eqn (E) to test H,: B, = B, 0.
2. (2) Consider the wage equation In(wage) A+BEDUC + B,EDUC +B,EXPER+B,EXPER+B.(EDUC EXPER)+e where the explanatory variables are years of education (EDUC) and years of experience (EXPER). Estimation results for this equation, and for modified versions of it obtained by dropping some of the variables, are displayed in Table 6.10 (see Table6 10.pdf in Canvas). These results are from 200 observations in the file cps5 small. Use a 5% level of significance for all tests. a) Use an F-test and the results in Eqn (A) and Eqn (B) to test H,: B-0. b) Use an -test and the results in Eqn (A) to test H: B, -0. Show that r-F obtained in part a). e) Use an F-test and the results in Eqn (A) and Eqn (C) to test H,: B,-B,-B.-0. d) Use an F-test and the results in Eqn (B) and Eqn (D) to test H,: B, -B,-0. e) Use an F-test and the results in Eqn (A) and Eqn (E) to test H,: B, = B, 0.
MATLAB: An Introduction with Applications
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Chapter1: Starting With Matlab
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Problem 1P
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Transcribed Image Text:2. (2) Consider the wage equation
In(wage) A+B EDUC + B,EDUC² +B,EXPER+B,EXPER+B,(EDUC EXPER)+e
where the explanatory variables are years of education (EDUC) and years of experience (EXPER).
Estimation results for this equation, and for modified versions of it obtained by dropping some of the
variables, are displayed in Table 6.10 (see Table6 10.pdf in Canvas). These results are from 200
observations in the file cps5 small. Use a 5% level of significance for all tests.
a) Use an F-test and the results in Eqn (A) and Eqn (B) to test H,:B.=0.
b) Use an -test and the results in Eqn (A) to test H: B-0. Show that r-F obtained in part a).
e) Use an F-test and the results in Eqn (A) and Eqn (C) to test H: B, = B, = B, -=0.
d) Use an F-test and the results in Eqn (B) and Eqn (D) to test H,: B, = B, =0.
e) Use an F-test and the results in Eqn (A) and Eqn (E) to test H:B, = B, =0.
Transcribed Image Text:TABLE 6,10
Wage Equation Estimates for Exercise 6.8
Coefticient Estimates and (Standard Errors)
Variable
Eyn (A)
Egn (B)
Egn (C)
Eqn (D)
Equ E)
0.403
1.4R3
1.812
2.674
1256
(0.771)
(0.109)
(0.191)
(0.495)
0.0657
(0.494)
0.0669
EDUC
0.175
0.0997
(0.0117)
(0.091)
-0.0012
(0.0692)
0.0012
(0.0024)
(0.04)
0.0010
EDUC
(0.0027)
(0.0024)
0.0222
(0.0090)
EXPER
0.0496
0.0228
0.0314
(0.0172)
(0.0091)
-0.00032
(0,0101)
--0.00060
EXPER
-0.00038
-0.00031
(0.00019)
(0.00019)
(0.00022)
(0.00019)
EXPER X EDUC
-0.001703
(0.000935)
SSE
AIC
SC
37.326
37.964
40.700
52.171
38.012
-1.619
-1.612
-1.562
-1.620
-1.529
-1513
-1.264
-1.554
6.9 RESET suggests augmenting an existing model with the squares or the squares and higher powers of
/2\ lst \ oel i. . 5 ), What would happen if you augmented
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