In this question you are asked to help the ministry of labor to analyze US wage data for females (X¡) and males (Y;). The data used are based on a sample of 526 observations where 252 of them are females: The following average hourly earnings observations are at hand: 1156 000 1605 017

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In this question you are asked to help the ministry of labor to analyze US wage data for females
(X;) and males (Y;). The data used are based on a sample of 526 observations where 252 of
them are females: The following average hourly earnings observations are at hand:
= 1156.090
E(x; – x)2 = 1605.817
Ey: = 1945.260
EGi – y)² = 4726.378
a) Test the wage discrimination hypothesis that wages are higher for males at a 1% significance
level. What can you say about the p-value of this test?
b) Calculate the power for the test in b) when the population differences in wages uy - ux
equal to: 0.100, 0.250, 0.500, 1.000, 1.500. Also, use the results to plot the power function
curve.
Transcribed Image Text:In this question you are asked to help the ministry of labor to analyze US wage data for females (X;) and males (Y;). The data used are based on a sample of 526 observations where 252 of them are females: The following average hourly earnings observations are at hand: = 1156.090 E(x; – x)2 = 1605.817 Ey: = 1945.260 EGi – y)² = 4726.378 a) Test the wage discrimination hypothesis that wages are higher for males at a 1% significance level. What can you say about the p-value of this test? b) Calculate the power for the test in b) when the population differences in wages uy - ux equal to: 0.100, 0.250, 0.500, 1.000, 1.500. Also, use the results to plot the power function curve.
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