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Problem 1. Now, we have the individual's average hourly earnings for two dierent years 1995 and 2915. Obviously, during that time period, prices in the
Problem 1. Now, we have the individual's average hourly earnings for two dierent years 1995 and 2915. Obviously, during that time period, prices in the economy have changed. 30, we need to adjust the Al-IE variable for ination using the Consumer Price Index (CPI). In 2915, CPI was 237, while in 1999 CPI was 156.9. Adjust the AHE variable in Stata for the price ination that occurred between 1995 and 2915. Here are some steps I would take to do that: 1) create a new variable [AHE15, for instance} that is equal to AHE for 2915; 2} if the year is not 2915 [but 1995'], replace the values of the new variable [AHE15) with the values of ALI-IE divided by the CPI for 1996 and multiplied by the CPI for 2915. Problem 2. Report the sample mean for average hourly earnings (ABE) in 1996 and 2915 after adjusting for ination. (You should not do any calculations by hand! Stata will do them for you. You need to just type 11p 1 line of commands.) Problem 3. Table 3.1 in the textbook presents information on the gender pay gap for college students. Prepare a similar table for high school graduates, using the 1995 and 2915 data. You would not be able to easily construct the table in Stata. Instead, prepare the table in Word or Excel, using the statistics calculated in State. Are there any notable dierences between the results for high school and college graduates? Problem 4. In Stata, use the appropriate estimates, condence intervals, and test statistics, to answer the questions below. a) Construct a 95% condence interval for the mean of AHE for high school graduates, using the data for 2915. Then, do the same using the data for 1996. (You should not do any calculations by hand! Stata will do them for you. You need to just type up 1 line of commands.) b] Construct a 95% condence interval for the mean of AHE for college graduates, using the data for 2915. Then, do the same using the data for 1996. [You should not do any calculations by hand! Stata will do them for you. You need to just type 11p 1 line of commands.)
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