Consider the following model that tries to estimate mortality rate (Y) due to heart disease in the

United States. The chose independent variables for this model are

X1 = cigarette consumption (pounds of tobacco) in per year

X2 = consumption of edible unhealthy fats per year

X3= consumption of meat etc. (pounds) in a year

X4 = Hours of Exercise per year

a) Write the model in equation form and hypothesize sign of coefficient for each explanatory

variable with explanation.

Now, you are given a dataset and after running the regression you get the following estimates

ln? = 140 + 10 X1 + 4.0 ln X2 - 1.0 lnX3 - 8 X4

(2.5) (1.0 ) (0.5) (1.2)

t = 4.0 4.0 - 2.0 -3.0

b) Explain all the coefficients and determine their statistical significance using t score.

c) Is there any coefficient that has a different sign than your hypothesized sign?

d) Do you think there is an omitted variable bias? What possible indications are present in the

model that can indicate a possible omitted variable bias?

e) Which of the following variables could possibly be an omitted variable that is causing the

unexpected sign? Explain and be sure to analyze expected bias in your explanation

i. consumption of hard liquor (gallons) in a year

ii. the average fat content (percentage) of the meat

iii. consumption of wine and beer (gallons) in a year

iv. number of miles run in a year

v. number of lipsticks sold in a year

f. Do you think the estimates of the given model are BLUE? Why or why not? Which classical

assumption got violated in this example?

g. Inclusion of which variable from the above list may introduce multicollinearity problem?

h. Inclusion of which variable from the above list may introduce irrelevant variable issue in the

model. How will it affect the estimate?

i. What will happen if we suppress the constant term in this equation?

j. If you think gender plays an important role in death by heart disease, then how would you

include that in the model? Provide explanation in support of your answer and hypothesize sign

of expected coefficients.

AP Macroeconomics Unit 6: Inflation, Unemployment and Stabilization Policies ASSUITIt all COUTUIlly UIat IS UpCIquily auUVE lull CITYIVYIIIGIRL. A. Draw a correctly labeled aggregate demand and aggregate supply graph and show each of the following: 1. The long-run aggregate supply curve ii. Current price level and output levels, labeled PLe and Ye ili. Full employment output, labeled Yf B. Identify one fiscal policy action that could resolve the problem. C. Using your graph in Part A, show the short-run effects of the action you identified on each of the following: i. Aggregate demand. Explain (use the cause and effect chain you learned in the lesson) ii. Output iii. Price level D. Using a correctly labeled loanable funds graph, show the effect of the policy you identified in Part B on real interest rates. E. Given the change in the real interest rate in Part D, what is the impact on each of the following? i. Investment ii. Economic growth rate. Explain. iii. The international value of the dollar. Explain. F. Now assume instead that the government takes no policy action to fix the problem identified in part A. i. In the long run, will the short-run aggregate supply increase, decrease, or remain unchanged? Explain. 3 of 44.1.53 Question Help Use the compound interest formulas A = P 1 + nt and A = Pert to solve the problem given. Round answers to the nearest cent. Find the accumulated value of an investment of $20,000 for 7 years at an interest rate of 4.5% if the money is a. compounded semiannually; b. compounded quarterly, c. compounded monthly, d. compounded continuously. MoreQuestion 28 You have $10,000 to invest in a bank certificate of deposit for 13 years. "Bank A" offers 11% interest compounded daily, "Bank B" offers 11.15% interest compounded monthly and "Bank C" offers 11.55% interest compounded annually. If you choose the right bank, how much will you have in your account 13 years later? O $44,442 O $53,754 $42,326 O $38,833 $41,778O QUESTION 3 Jason has $100,000 to invest in a savings account. He has two options: Option A earns 4% interest compounded quarterly, and Option B earns 3.994 interest compounded continuously. Which account will be more valuable after 10 years? O Option A O Option B QUESTION 4 These two questions Jason has $100,000 to invest in a savings account. He has two options: Option A earns 49% interest compounded quarterly Option B earns 3.99% Interest compounded continuously. How much more money will be in the more valuable account after 10 years? Send a chat Click Save and Submit to save and submit. Click Save All Answers to save all answers. Saye All OQUESTION 44 Fill in the blank(s) below. Possible options are given in the parentheses after each blank. Note that in order to get credits for this question, your answers must be completely correct. There is no partial credit so as to discourage you from simply guessing the answers. A cut in military spending and an expansion of an investment tax credit would definitely cause the (price, quantity) of loanable funds traded in the loanable funds market to (increase, decrease). QUESTION 45 Look at Figure 3.2 in Section 1.2. Suppose you know that, at a price of $4, the quantity supplied is 10 million pounds, and at a price of $7, the quantity supplied is 40 million pounds. What is the quantity supplied when price is at $5? Type your answer as a whole number. Round it if necessary. Leave out the unit of measurement: For example, if your answer is 17 million pounds, type it as 17, not 17,000,000