Homework Help is Here – Start Your Trial Now!
Math
Statistics
d. Are each of the coefficient estimates significant at a 5% level? Why? e. Test the hypothesis that the addition of an extra child decreases the mean budget share of alcohol. by 2 percentage points against the alternative that the decrease is not equal to 2 percentage points. Use a 5% significance level.

d. Are each of the coefficient estimates significant at a 5% level? Why? e. Test the hypothesis that the addition of an extra child decreases the mean budget share of alcohol. by 2 percentage points against the alternative that the decrease is not equal to 2 percentage points. Use a 5% significance level.

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
See similar textbooks
icon
Related questions
Question
Please answer 5.3 d and e
2:01 --WS 5.3 Consider the following model that relates the percentage of a household's budget spent on alcohol WALC to total expenditure TOTEXP, age of the household head AGE, and the number of children in the household NK. WALC=B₁ + B₂ In(TOTEXP) + B₂NK + BAGE+e This model was estimated using 1200 observations from London. An incomplete version of this output is provided in Table 5.6. Output for Exercise 5.3 TABLE 5.6 Dependent Variable: WALC Included observations: 1200 Variable C In(TOTEXP) NK AGE R-squared S.E. of regression Sum squared resid Coefficient 1.4515 2.7648 -0.1503 46221.62 Std. Error 2.2019 0.3695 0.0235 Jabolt noissgol 5.8 Ex a. Fill in the following blank spaces that appear in this table. i. The t-statistic for b₁. ii. The standard error for b₂. iii. The estimate by. iv. R². t-Statistic ATSIOO X EMC 5.7103 -3.9376 -6.4019 Mean dependent var allol od tod 6.19434 S.D. dependent varmabes (xl) 6.39547 114142 Prob. 0.5099 0.0000 0.0001 0.0000 V. 8. b. Interpret each of the estimates b₂, b3, and b₁. c. Compute a 95% interval estimate for B₁. What does this interval tell you? d. Are each of the coefficient estimates significant at a 5% level? Why? e. Test the hypothesis that the addition of an extra child decreases the mean budget share of alcohol by 2 percentage points against the alternative that the decrease is not equal to 2 percentage points. Use a 5% significance level. 5.4 Consider the following model that relates the percentage of a household's budget spent on alcohol, WALC, to total expenditure TOTEXP, age of the household head AGE, and the number of children in the household NK. WALC=B₁ + B₂ In(TOTEXP) + B,NK + BAGE+BAGE² +e Some output from estimating this model using 1200 observations from London is provided in Table 5.7. The covariance matrix relates to the coefficients b, b, and b. 2. Find a point estimate and a 95% interval estimate for the change in the mean budget percentage share for alcohol when a household has an extra child. a marginal effect of AGE on the mean budget c. Find a point estimate and a 95% interval estimate for the age at which the mean budget percentage percentage share for alcohol when (i) AGE = 25, (ii) AGE = 50, and (iii) AGE= 75. share for alcohol is at a minimum. d. Summarize what you have discovered from the point and interval estimates in (a), (b), and (c). ally distributed.
Transcribed Image Text:2:01 --WS 5.3 Consider the following model that relates the percentage of a household's budget spent on alcohol WALC to total expenditure TOTEXP, age of the household head AGE, and the number of children in the household NK. WALC=B₁ + B₂ In(TOTEXP) + B₂NK + BAGE+e This model was estimated using 1200 observations from London. An incomplete version of this output is provided in Table 5.6. Output for Exercise 5.3 TABLE 5.6 Dependent Variable: WALC Included observations: 1200 Variable C In(TOTEXP) NK AGE R-squared S.E. of regression Sum squared resid Coefficient 1.4515 2.7648 -0.1503 46221.62 Std. Error 2.2019 0.3695 0.0235 Jabolt noissgol 5.8 Ex a. Fill in the following blank spaces that appear in this table. i. The t-statistic for b₁. ii. The standard error for b₂. iii. The estimate by. iv. R². t-Statistic ATSIOO X EMC 5.7103 -3.9376 -6.4019 Mean dependent var allol od tod 6.19434 S.D. dependent varmabes (xl) 6.39547 114142 Prob. 0.5099 0.0000 0.0001 0.0000 V. 8. b. Interpret each of the estimates b₂, b3, and b₁. c. Compute a 95% interval estimate for B₁. What does this interval tell you? d. Are each of the coefficient estimates significant at a 5% level? Why? e. Test the hypothesis that the addition of an extra child decreases the mean budget share of alcohol by 2 percentage points against the alternative that the decrease is not equal to 2 percentage points. Use a 5% significance level. 5.4 Consider the following model that relates the percentage of a household's budget spent on alcohol, WALC, to total expenditure TOTEXP, age of the household head AGE, and the number of children in the household NK. WALC=B₁ + B₂ In(TOTEXP) + B,NK + BAGE+BAGE² +e Some output from estimating this model using 1200 observations from London is provided in Table 5.7. The covariance matrix relates to the coefficients b, b, and b. 2. Find a point estimate and a 95% interval estimate for the change in the mean budget percentage share for alcohol when a household has an extra child. a marginal effect of AGE on the mean budget c. Find a point estimate and a 95% interval estimate for the age at which the mean budget percentage percentage share for alcohol when (i) AGE = 25, (ii) AGE = 50, and (iii) AGE= 75. share for alcohol is at a minimum. d. Summarize what you have discovered from the point and interval estimates in (a), (b), and (c). ally distributed.
Expert Solution
Step 1

Given the Regression out put of the model

WALC=β1+β2lnTOTEXP+β3NK+β4AGE+e

This model is estimated using 1200 observations from London.

 

steps

Step by step

Solved in 3 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Recommended textbooks for you
MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
Statistics
ISBN:
9781119256830
Author:
Amos Gilat
Publisher:
John Wiley & Sons Inc
Probability and Statistics for Engineering and th…
Probability and Statistics for Engineering and th…
Statistics
ISBN:
9781305251809
Author:
Jay L. Devore
Publisher:
Cengage Learning
Statistics for The Behavioral Sciences (MindTap C…
Statistics for The Behavioral Sciences (MindTap C…
Statistics
ISBN:
9781305504912
Author:
Frederick J Gravetter, Larry B. Wallnau
Publisher:
Cengage Learning
Elementary Statistics: Picturing the World (7th E…
Elementary Statistics: Picturing the World (7th E…
Statistics
ISBN:
9780134683416
Author:
Ron Larson, Betsy Farber
Publisher:
PEARSON
The Basic Practice of Statistics
The Basic Practice of Statistics
Statistics
ISBN:
9781319042578
Author:
David S. Moore, William I. Notz, Michael A. Fligner
Publisher:
W. H. Freeman
Introduction to the Practice of Statistics
Introduction to the Practice of Statistics
Statistics
ISBN:
9781319013387
Author:
David S. Moore, George P. McCabe, Bruce A. Craig
Publisher:
W. H. Freeman
SEE MORE TEXTBOOKS