ECMT1020: Introduction to Econometrics

Tutorial questions, set 1

Question 1. For each of the following examples, state whether the data are numerical or categorical, and
state whether they are cross-sections, time series, or panel data.
(a) Quarterly data on the level of new housing construction in Australia, from 2000 to 2015.
(b) Quarterly data on the level of new housing construction in Australia, from 2000 to 2015, broken down
by state or territory.
(c) Data on the number of doctor visits in 2015 for a sample of 192 individuals.
(d) Data on the total number of doctor visits in Australia, for every week in 2015.
(e) Data on the usual mode of transportation used to commute to work, for a sample of 151 individuals.
(f) The closing price of the Dow Jones Index, for every trading day in 2015.
(g) Data on whether the closing price of the Dow Jones Index was higher or lower than the day before,
for every trading day in 2015.
(h) Data on whether the closing prices of the Dow Jones Index, the Nasdaq Index, and the S&P 500 Index
were higher or lower than the day before, for every trading day in 2015.
(i) Data on which of the Dow Jones Index, the Nasdaq Index, and the S&P 500 Index gained the most in
value, for every trading day in 2015.

n
X
Question 2. Assume that n = 5. Compute zi in each of the following cases.
i=1
(a) zi = 1.
(b) zi = i − 3.
(c) zi = i2 / 20.
(d) zi = 1/i.

Question 3. Consider the following set of five data points: {11, 14, 6, 0, 14}.
(a) Compute the median, mean, standard deviation, coefficient of variation, skewness statistic, and kur-
tosis statistic. Note: for the skewness and kurtosis statistic, various slightly different formulas are given
– just pick the ones that you find easiest to calculate.
(b) For each of the six statistics you computed in part (a), discuss what the interpretation is.

Question 4. Refer to the data set in question 3.

(a) Suppose that all values are multiplied by 100, so the data set is now {1100, 1400, 600, 0, 1400}. (For
example, we might decide to measure our variable in cents instead of dollars.) Which of the six statistics
change, and which stay the same?
(b) Suppose instead that all values are increased by 3, so the data set is now {14, 17, 9, 3, 17}. (For
example, everyone in our sample gets an unexpected year-end bonus.) Which of the six statistics change,
and which stay the same?
Question 5. IQ scores are defined such that their distribution is normal, with a mean of 100 and a
standard deviation of 14.
(a) What fraction of the population has an IQ score over 114?
(b) What fraction of the population has an IQ score over 128?
(c) What fraction of the population has an IQ score over 142?

Question 6. The following histogram and summary statistics were obtained using Stata. The variable is
the number of days that each of the 196 employees of a certain firm called in sick in February 2016.
80
60
Frequency
40
20
0

0 5 10 15 20
sick_days

sick_days
-------------------------------------------------------------
Percentiles Smallest
1% 0 0
5% 0 0
10% 0 0 Obs 196
25% 0 0 Sum of Wgt. 196

50% 1 Mean 2.387755

Largest Std. Dev. 3.152964
75% 3.5 12
90% 6 12 Variance 9.941183
95% 9 14 Skewness 2.13656
99% 14 20 Kurtosis 8.911501

(a) Based on the histogram, do the data appear to be symmetric, right-skewed, or left-skewed? Also
provide an intuitive reason why they should be.
(b) Find three indications in the summary statistics that support your answer to part (a).
(c) What does the kurtosis statistic of 8.9 tell you about the data? Does this seem reasonable, given the
histogram?