INTRODUCTION TO ECONOMETRICS 2024-2025
Multiple Choice Preparation Questions for Mini-Exam 1
MC PREPARATION QUESTION 1: Inspect the wealth variable from the summary table of INSTRUCTION 7
in PC Lab 1. Now, you want to create a dummy variable indicating that an individual has an abovemedian wealth level. Which command should you run (be as specific as possible)?
a) generate highwealth = (wealth>=2)
b) replace highwealth = (wealth>=3)
c) replace highwealth = (wealth>=3) if wealth!=.
d) generate highwealth = (wealth>2) if wealth!=.
MC PREPARATION QUESTION 2: How do you obtain the mean of the variable “country”? Interpret it.
a)
b)
c)
d)
summarize country. On average, individuals are from country 2.
test country. On average, individuals are from country 2
summarize country. There is no interpretation of the mean.
test country. There is no interpretation of the mean.
MC PREPARATION QUESTION 3: We now use the variable sixtyfive_plus created in INSTRUCTION 11a of
PC Lab 1. Which of the following command(s) test directly the significance of the difference between the
blood pressure of people who are older and younger than 65 years old (be as specific as possible):
a)
b)
c)
ttest diast_bp, by(sixtyfive_plus) unequal
regress diast_bp sixtyfive_plus, robust
mean diast_bp, over(sixtyfive_plus)
d)
a) and b)
MC PREPARATION QUESTION 4: What does the regression we ran in INSTRUCTION 12 of PC lab 2 suggest
about the relationship between blood pressure and education? Choose the most appropriate answer.
a) Compared to the individuals in the lowest education category, the average blood pressure of the
highest educated individuals is lower by 2.981 mm Hg.
b) As individuals are better educated, blood pressure increases on average.
c) As education increases by 4, average blood pressure increases by 2.981 mm Hg.
d) a) and c).
MC PREPARATION QUESTION 5: Consider the results obtained with INSTRUCTIONS 7 to 10 of the takehome assignment. What is the value of the test statistic that you should consider if you want to test if
there is an effect of country on diastolic blood pressure, given age, gender, smoking, drinking, and country
(for the purpose of this specific question, you may assume that all relevant assumptions hold):
a)
b)
c)
d)
It does not matter because all p-values are smaller than 0.05.
t-stat = -24.03
t-stat = 35.10
F-stat = 713.76.
MC PREPARATION QUESTION 6: Consider the results for smoke in one of the two tables of results
produced in INSTRUCTION 16 of the take-home assignment. From these results, what do you learn about
the following correlations?
a)
b)
c)
d)
The correlation between BMI and smoking is positive.
The correlation between gender and smoking is positive.
The correlation between drinking and smoking is positive.
You cannot say anything about these correlations because they are not included in the table
and besides the models have as dependent variable blood pressure, not BMI, smoking,
gender, nor drinking.