# Econ2206 Exam Paper

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Pages: 12

THE UNIVERSITY OF NEW SOUTH WALES

SCHOOL OF ECONOMICS

ECON 2206 INTRODUCTORY ECONOMETRICS FINAL EXAMINATION SESSION 1, 2008

1. TIME ALLOWED - 2 Hours.

2. READING TIME = 10 Minutes 3. THIS EXAMATION PAPER HAS 9 PAGES 4. TOTAL NUMBER OF QUESTIONS - 6. 5. ANSWER ALL QUESTIONS. 6. ALL QUESTIONS ARE OF EQUAL VALUE 7. TOTAL MARKS AVAILABLE FOR THIS EXAMATION - 60. 8. THE MARKS AWARDED TO EACH PART OF A QUESTION ARE INDICATED. 9. CANDIDATES MAY BRING THEIR OWN CALCULATORS TO THE EXAM 10. STATISTICAL TABLES ARE PROVIDED AT THE END OF THE EXAM PAPER 11. ALL ANSWERS MUST BE WRITTEN IN PEN. PENCILS MAY BE USED ONLY FOR DRAWING, SKETCHING OR GRAPHICAL WORK. 12. THIS PAPER MAY BE RETAINED BY THE CANDIDATE

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Use a 1% significance level. The R2 statistic for the model with these restrictions imposed is R 2 = 0.125. What do you conclude? (3 marks)

(iv) Do you think that this model captures the causal effect of nox on house prices? Explain. (2 Mar-ks)

NOTE: The F-test statistic is given by the formula:

F =

(SSR r - SSRur)/q SSRur/(n - k - 1)
(1 (R~r - R;)/q Il~r)/(n - k - 1)

where SSIl is the sum of squared residuals, q is the number ofrestrictions, and ur and r stand for unrestricted and restricted models, respectively.