Economics 310 Menzie D. Chinn Spring 2004 Social Sciences 7418 University of Wisconsin-Madison Problem Set 3 This problem set is due in lecture on Monday, March 29th. No late problem sets will be accepted. Be sure to show your work (that is, do not use a spreadsheet or statistical program to generate your answers), and to write your name, ID number, as well as the name of your Teaching Assistant, on your problem set. From the textbook: • 5.50 • 5.70 • 6.34 • 6.10 • 6.22 • 6.26 • 7.4 • 7.26 • 7.88 • 7.58 • Y.1 Find t0 given that P(t > t0) = A a. A= 0.10, 12 d.f. b. A=0.01, 25 d.f. c. A=0.05, 16 d.f. • Y.2 A random sample of n=500 observations from a binomial population produced x=140 successes. Find a 95% confidence interval for p, and interpret the interval. • 8.8 • 8.18 • Y.3. Below are summary statistics and a histogram labor productivity growth rates (quarter-on-quarter) over the 1970q1-2003q4 period, calculated as ln(xt)-ln(xt-1)04812162024-0.01 0.00 0.01 0.02 0.03Series: DLPRODSample 1970:1 2003:4Observations 136Mean 0.005254Median 0.005106Maximum 0.029632Minimum -0.013793Std. Dev. 0.007765Skewness 0.083884Kurtosis 3.445177Jarque-Bera 1.282530Probability 0.526626 a. What is the 99% confidence interval for quarterly productivity growth? b. During the late 1990’s there was discussion of a New Economy, characterized by accelerated GDP growth. Over the 1995q1-2003q4 period, the growth rate was 0.7244% quarter on quarter, with standard deviation of 0.6453%. 02468100.00 0.01 0.02Series: DLPRODSample 1995:1 2003:4Observations 36Mean 0.007244Median 0.007486Maximum 0.020778Minimum -0.004929Std. Dev. 0.006453Skewness 0.404556Kurtosis 2.650212Jarque-Bera 1.165523Probability 0.558354 Conduct a hypothesis test that 1995q1-2003q4 growth rate was different from the of 0.4538% quarter on quarter growth rate prevailing during the 1970q1-1994q4 period. State your assumptions. c. If you expressed the growth rates in annualized terms (here by multiplying the quarter-on-quarter growth rates by 4), would that change your answers?
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