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Mid Exam

Mid exam econometrics

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0% found this document useful (0 votes)
27 views3 pages

Mid Exam

Mid exam econometrics

Uploaded by

Kahsayhagos
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Raya University

College of Business and Economics

Department of Economics

Mid Exam

Course Name: Econometrics for management, Course Code: MGMT3071, Exam date 12-11-
2023, to be held from 10:00 – 11:00 L.T. Time allowed: 60 minutes. Value: 20%.

Instructions:

 Switch off your mobile phones.


 Use only the answer sheet for providing the answers to all questions.
 Make sure your question paper has three parts and 3 pages (including the cover page).
 Write briefly, clearly, and legibly.
 For multiple-choice questions, ambiguous selections will be marked wrong!
 Cheating is strictly forbidden!
 Do not open this exam until instructed to do so!
Name___________________________________ID No__________________Section ____

Exam Committee

Name Signature Date

1.

2.

3.

Have a nice exam!

Prepared by: Kahsay Hagos Page 1


Part I: write true if the statement is correct otherwise false (one point each).

1. Pooled data is a data obtained by combining both cross-sectional and time series data
2. Econometrics is the application of statistical and mathematical methods to the analysis of
economic data with a purpose of giving empirical content to economic theories and
verifying or refuting them.

Part II: Choose the best answer from the given alternatives (one point each).

1. In the simple linear regression model i.e. Y = α+Βx+↋i, the regression slope:
A. Represents the elasticity of Y on X
B. Indicates by how many units Y increases, given a one-unit increase in X
C. Indicates by how many percent Y increases, given a one percent increase in X
D. All
2. E(ui) = 0 says that:
A. The sample mean of the Xs is much larger than the sample mean of the errors.
B. Dividing the error by the explanatory variable results in a zero.
C. The sample regression function residuals are unrelated to the explanatory variable.
D. The error terms have zero mean.
3. The OLS estimator is derived by
A. Minimizing the sum of absolute residuals.
B. Maximizing the sum of squared residuals.
C. Maximizing the sum of absolute residuals.
D. Minimizing the sum of squared residuals.

Prepared by: Kahsay Hagos Page 2


Part III: Workout (Show all necessary steps)

1. The economic theory of consumption states that consumption expenditure at a given point
in time (Ct) is positively affected by level of income at a given point in time (It). Suppose
that the functional relationship in the stated economic theory is Linear and an intercept and a
slope estimate of the function are β0 and β1, respectively. Based on the stated economic
theory and the associated information, answer the following questions: (15%)
a) Identify the dependent and the independent variables.
b) Specify the mathematical model
c) Specify the econometric model and explain what makes it to be distinct from
the mathematical model
d) Assume that the intercept and the slope estimates are given as 82 and 0.6
respectively, write estimated econometric model, interpret the intercept, and slope
estimate.
e) Using the estimated econometric model on (d) given above what will be the
predicated value of the dependent variable at a given value of the independent
variable that is equals to 50.

Answer Sheet
Name__________________________________IDNo_____________Sec.______

I. True/False
1_______2_______
II. Multiple Choice

1____2____3____
III. Work out

Prepared by: Kahsay Hagos Page 3

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