Textbook problems:
5.6, 5.9 (c), (d), (e), (f)

Computer exercise: (do one of the problems below)

1. The dataset cars93.txt (open using "File," "Import ASCII") or 93cars.dta (open using "File," "Open") contains the following variables:
 

make - Manufacture model - Manufacturers model type - As defined in Consumers Reports minprice -  Price for basic version midprice -  Average of basic and premimum maxprice -  Price for a premimum version capacity - Engine size in liters fuelcap -  Fuel tank capacity cityMPG - City MPG by EPA ratings hgwMPG -  Highway MPG by EPA rating airbags - airbags  Air bags standard

drvtrain - drvtrain Drive train type cylindrs -  Number of engine cylinders  horspwr - Maximum engine horsepower RPMmaxHP - Revs per minute at maximum HP maxrevs -  Engine revolutions/mile in high numpass -  Passenger capacity length - Car length in inches width - Car width in inches U_turn - U-turn space in feet weight - Curb weight in pounds domestic - domestic US manufacture or not

  Do the following exercises:

1. Suppose you are trying to explain basic model prices of cars. This means that the dependent variable in your model is the price of the basic model of the car (minprice). Estimate a simple regression model with one explanatory variable of your choice.
2. Interpret the coefficients obtained.
3. Under what are the assumptions does your estimation make sense?

2. The data were updated on Monday, April 8. They now include 27 observations. The data from survey2 are available in comma delimited file survey2.csv (open using "File," "Import ASCII"), as stata dataset survey2.dta (open using "File," "Open"), or as an excel file survey2.xls. There are following variables in the dataset:

• score - student score on the midterm
• class - student class (02,03,04,05)
• female - =1 if female
• gpa - student GPA
• stat - =1 if student took STAT101, STAT201 or PSYCH201
• math - number of MATH/STAT courses a student took
• econ - number of ECON course a student took
• hours_e - number of hours studied for the exam
• hours_c - average number of hours per week studied for ECON253
• miss - number of missed classes prior to the exam
• alone - =1 if studied in a group
• ps - number of problem sets turned in
• ps_plus - number of check pluses on the problem set
• ta - number of TA sessions attended
• review - =1 if review session attended

1. Suppose you are trying to explain student score on the midterm. This means that the dependent variable in your model is student score on the midterm (score). Estimate a simple regression model with one explanatory variable of your choice. Do not choose one of the 0/1 variables, they will be covered later in the course.
2. Interpret the coefficients obtained.
3. Under what are the assumptions does your estimation make sense?