• Use Excel to conduct a regression of the values of the security against the predictors and verify the validity of underlying assumptions
  • Check for homoscedasticity and serial correlation
  • If necessary, rerun the regression using robust standard errors
  • Look for evidence of multicollinearity and eliminate redundant predictors if necessary

The worksheet "grocery" of "Assignment #4-2 (DATA)" gives the median store size (in square feet) by year for grocery stores. Note that this file is the same as the one given in Question 1.

Step 1: Run the simple linear regression and find the slope of the sample regression equation. Give your answer to 4 decimal places.

Answer- .6783

Step 2- According to the sample regression line, a point estimate for the median grocery store size in 2012 is: (Give your answer to 1 decimal place.)

Answer- 49.9

Step 3- The standard error of fit is approximately?? (Give your answer to 3 decimal places.)

5. Part a: Use the equation of exchange to derive a relationship between the inflation rate and the growth rate of the money stock. What assumptions did you make?

Part b: Milton Friedman stated, “Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output.” Consider the following.

i) Since 2006, what has been the behavior of the monetary base? ii) Since 2006, what has been the CPI inflation rate?

Support your answer with graphs.

Explain the divergence of the empirical evidence and the theoretical predictions regarding inflation.

A poll conducted between February and April of 2006 surveyed 2822 Internet users and found that 198 of them had downloaded a podcast to listen to it or view it later at least once. A similar poll in May of the same year found that 295 of 1553 Internet users had downloaded a podcast at least once. Test the null hypothesis that the two proportions are equal.

NO HANDWRITTEN ANSWERS PLEASE

The most common abuse of correlation in studies is to confuse the concepts of correlation with those of causation.

Good SAT scores do not cause good college grades, for example. Rather, there are other variables, such as good study habits and motivation, that contribute to both. Find an example of an article that confuses correlation and causation.

Discuss other variables that could contribute to the relationship between the variables.

Recall again that Rind & Bordia (1996) investigated whether or not drawing a happy face
on customers’ checks increased the amount of tips received by a waitress at an upscale
restaurant on a university campus. During the lunch hour a waitress drew a happy,
smiling face on the checks of a random half of her customers. The remaining half of the
customers received a check with no drawing (18 points).
The tip percentages for the control group (no happy face) are as follows:
45% 39% 36% 34% 34% 33% 31% 31% 30% 30% 28%
28% 28% 27% 27% 25% 23% 22% 21% 21% 20% 18%
8%
The tip percentages for the experimental group (happy face) are as follows:
72% 65% 47% 44% 41% 40% 34% 33% 33% 30% 29%
28% 27% 27% 25% 24% 24% 23% 22% 21% 21% 17%

This time, you are to perform a “hypothesis test” using the tip data, answering each of
the questions below. For short-answer questions, be brief. However, you must give
enough detail to justify your answers. Single-sentence responses will generally not
suffice, but do not exceed a paragraph for any given answer.

f. Recall that one of the assumptions of the independent t-test is homogeneity
of variance. If you had to explain this assumption to someone with little
statistical expertise, how would you explain it?

Recall again that Rind & Bordia (1996) investigated whether or not drawing a happy face
on customers’ checks increased the amount of tips received by a waitress at an upscale
restaurant on a university campus. During the lunch hour a waitress drew a happy,
smiling face on the checks of a random half of her customers. The remaining half of the
customers received a check with no drawing (18 points).
The tip percentages for the control group (no happy face) are as follows:
45% 39% 36% 34% 34% 33% 31% 31% 30% 30% 28%
28% 28% 27% 27% 25% 23% 22% 21% 21% 20% 18%
8%
The tip percentages for the experimental group (happy face) are as follows:
72% 65% 47% 44% 41% 40% 34% 33% 33% 30% 29%
28% 27% 27% 25% 24% 24% 23% 22% 21% 21% 17%

This time, you are to perform a “hypothesis test” using the tip data, answering each of
the questions below. For short-answer questions, be brief. However, you must give
enough detail to justify your answers. Single-sentence responses will generally not
suffice, but do not exceed a paragraph for any given answer.

o. Considering both the probability value and effect size measure, what
interpretations would you make about the findings? That is, what are your
conclusions about the effects of leaving happy faces on checks?

Recall again that Rind & Bordia (1996) investigated whether or not drawing a happy face
on customers’ checks increased the amount of tips received by a waitress at an upscale
restaurant on a university campus. During the lunch hour a waitress drew a happy,
smiling face on the checks of a random half of her customers. The remaining half of the
customers received a check with no drawing (18 points).
The tip percentages for the control group (no happy face) are as follows:
45% 39% 36% 34% 34% 33% 31% 31% 30% 30% 28%
28% 28% 27% 27% 25% 23% 22% 21% 21% 20% 18%
8%
The tip percentages for the experimental group (happy face) are as follows:
72% 65% 47% 44% 41% 40% 34% 33% 33% 30% 29%
28% 27% 27% 25% 24% 24% 23% 22% 21% 21% 17%

This time, you are to perform a “hypothesis test” using the tip data, answering each of
the questions below. For short-answer questions, be brief. However, you must give
enough detail to justify your answers. Single-sentence responses will generally not
suffice, but do not exceed a paragraph for any given answer.

h. Enter the data above into SPSS. You will enter in two variables for each
restaurant patron: 1) which experimental group they belonged to (1 = no
happy face, 2 = happy face) and 2) the tip percentage left.

Recall again that Rind & Bordia (1996) investigated whether or not drawing a happy face
on customers’ checks increased the amount of tips received by a waitress at an upscale
restaurant on a university campus. During the lunch hour a waitress drew a happy,
smiling face on the checks of a random half of her customers. The remaining half of the
customers received a check with no drawing (18 points).
The tip percentages for the control group (no happy face) are as follows:
45% 39% 36% 34% 34% 33% 31% 31% 30% 30% 28%
28% 28% 27% 27% 25% 23% 22% 21% 21% 20% 18%
8%
The tip percentages for the experimental group (happy face) are as follows:
72% 65% 47% 44% 41% 40% 34% 33% 33% 30% 29%
28% 27% 27% 25% 24% 24% 23% 22% 21% 21% 17%

This time, you are to perform a “hypothesis test” using the tip data, answering each of
the questions below. For short-answer questions, be brief. However, you must give
enough detail to justify your answers. Single-sentence responses will generally not
suffice, but do not exceed a paragraph for any given answer.

l. Using the formula discussed in class, calculate Cohen’s d effect size measure.
Provide a brief interpretation of the statistic. Note: simply saying that the
effect is “small”, “medium”, or “large” will not suffice.

Recall again that Rind & Bordia (1996) investigated whether or not drawing a happy face
on customers’ checks increased the amount of tips received by a waitress at an upscale
restaurant on a university campus. During the lunch hour a waitress drew a happy,
smiling face on the checks of a random half of her customers. The remaining half of the
customers received a check with no drawing (18 points).
The tip percentages for the control group (no happy face) are as follows:
45% 39% 36% 34% 34% 33% 31% 31% 30% 30% 28%
28% 28% 27% 27% 25% 23% 22% 21% 21% 20% 18%
8%
The tip percentages for the experimental group (happy face) are as follows:
72% 65% 47% 44% 41% 40% 34% 33% 33% 30% 29%
28% 27% 27% 25% 24% 24% 23% 22% 21% 21% 17%

This time, you are to perform a “hypothesis test” using the tip data, answering each of
the questions below. For short-answer questions, be brief. However, you must give
enough detail to justify your answers. Single-sentence responses will generally not
suffice, but do not exceed a paragraph for any given answer.

i. Obtain the appropriate test statistic. From the SPSS menus choose Analyze
and Compare Means, followed by the appropriate test.