Econometrics Practice Exam (10 multiple Choice Questions)
I.
Choose ONE answer only:
_______#1. Which of the following is TRUE?
a.
Y~N(1,2) means that E[Y] = 3
b. Y~N(1,2) means that (Y  1) / 2 ~N(1,0)
c. Y ~N(1,2) and Z~N(2,1) means that Y+Z~N(3,3) always
d. Y ~N(1,2) and Z = Y + 3 means that Y + Z~N(5,2)
e. Y ~N(1,2) and Z~N(2,1) and independent means that Y - Z~N(-1,3)
________#2. Suppose that f ( x)  b for 0 < x < a. What values of a and b will
ensure that f(x) is a pdf?
a. a = 1/2 and b = 1
b. a = 1 and b = 1/2
d. b < 0 and a > 0
_______#3. Suppose that Y = AX + B.
a. A2
b. A2 + B2
_______#4.
a.
c. a = 2 and b = 1/2
e. b = -1 and a = -1
Then var(Y) = ____?
c. A2var(X)
d.
A2var(X) + B
e. A2var(X) + B2
Which of the following is TRUE?
(x
t
c.
 x ) 2  x 2  2 Nx 2
(x
t
 x ) 2  x 2  Nx
b.
(x
t
d.
 x ) 2  x 2  N 2 x 2
(x
t
 x)  0
_______#5. Suppose that Yt  X t   t and assume that we do NOT estimate with
OLS.
Instead we estimate  by ̂ 
a. E[ ˆ ] ≠ 
Y
X
t
. Therefore we know that
t
b. var( ˆ ) =
 2N
( X t ) 2
_______#6. Suppose that Yt   o  1 X t   t .
c.
 ˆ
t
Additionally, let our data be X1 =
2, X2 = 1, X3 = 0 and Y1 = 2, Y2 = 3, and Y3 = 1. The
for  o and  1 are therefore equal to
ˆ1
a.
̂ 0
= 3/2
b.
̂ 0
=1
c.
̂ 0
= 2/3
and
ˆ1
= 1/2
d.
̂ 0
= 3/2
and
ˆ1
= 1/2
e.
̂ 0
= 2/3
and
ˆ1
= -1
________#7.
and
ˆ1
OLS estimates
= 1
= -1
In the regression in problem #6 above, the estimate of  2 = _____.
a. 3/2
_______#8.
and
0
b. 1
c. 1/2
d. 1/4
e.
1/ 2
If Yt   o  1 X t   t , then for OLS, Yˆt  ˆo  ˆ1 X t  ˆt .
a. true
b. false
_______#9. Suppose that Yt  X t   t .
X2 = 1,
X3 = 0 and
Additionally, let our data be X1 = 2,
Y1 = 2, Y2 = 3, and Y3 = 1. The OLS estimates for 
is therefore equal to
a.
ˆ
= 1/2
b.
ˆ
= 5/3
c.
ˆ
= 8/5
d.
ˆ
= 7/5
e.
ˆ
= 11/3
_______#10. Based on your calculations in #9 above, the estimate of  2 = _____.
a.
23/4
b. 1
c.
21/10
d. 17/4
e.
1/ 2