Amsterdam is considering spending $10 million to upgrade its dykes, which hold back sea at high tide from flooding the city. The upgrades will last for 3 years, and the benefits in each of the three years will be $4 million.

The discount rate is 10%. According to a benefit-cost analysis, what is the Present Discounted Value of the project? State your answer to two decimal places, in terms of millions.

Bank of America's Consumer Spending Survey collected data on annual credit card charges in seven different categories of expenditures: transportation, groceries, dining out, household expenses, home furnishings, apparel, and entertainment (U.S. Airways Attache, December 2003). Using data from a sample of 42 credit card accounts, assume that each account was used to identify the annual credit card charges for groceries (population 1) and the annual credit card charges for dining out (population 2). Using the difference data, the sample mean difference was     = $859, and the sample standard deviation was sd = $1,213.

What is the point estimate of the difference between the population means? $

What is the 95% confidence interval estimate of the difference between the population means (to the nearest whole number)?

Bank of America's Consumer Spending Survey collected data on annual credit card charges in seven different categories of expenditures: transportation, groceries, dining out, household expenses, home furnishings, apparel, and entertainment (U.S. Airways Attache, December 2003). Using data from a sample of 42 credit card accounts, assume that each account was used to identify the annual credit card charges for groceries (population 1) and the annual credit card charges for dining out (population 2). Using the difference data, the sample mean difference was     = $859, and the sample standard deviation was sd = $1,213.

What is the point estimate of the difference between the population means? $

What is the 95% confidence interval estimate of the difference between the population means (to the nearest whole number)?

Suppose a nationwide small-government movement leads state and local governments to

significantly reduce their capital spending on roads and other infrastructure. Using the lenders' -

borrowers' curve apparatus discussed in class or other appropriate tools, analyze the effect this

change in behavior would have on:

1) the yield of tax exempt bonds (r E),

2) the quantity of tax exempt bonds issued (Q E), and

3) the implied marginal tax bracket T M

Suppose the federal government unexpectedly decreases its spending.

Using the IS-LM model, explain how this contractionary fiscal policy affects the real interest rate, r, and total output, Y , in both the short run and the long run.

What happens to consumption, C, investment, I, and government expenditure, G, in the short-run?

What happens to C, I, G, and r in the long- run?

(Note: For full credit, you must provide a brief explanation for why each variable changes or remains constant.)

Question 7 (1 point)

A survey asked subjects, "Should the government increase its spending on health?" 317 of those 340 who responded said "yes."

Test, at level 0.05, that the majority of people in the population would say "yes" to the survey question.

The test is

Question 7 options:

Question 8 (1 point)

A survey asked subjects, "Should the government increase its spending on health?" 317 of those 340 who responded said "yes."

Test, at level 0.05, that the majority of people in the population would say "yes" to the survey question.

The p-value is

Question 8 options:

Question 9 (1 point)

A survey asked subjects, "Should the government increase its spending on health?" 317 of those 340 who responded said "yes."

Test, at level 0.05, that the majority of people in the population would say "yes" to the survey question.

The conclusion of the test is

Question 9 options:

Question 10 (1 point)

A survey asked people who work full time, "How do you spend your time on a typical day?" 74% of 733 women and 55% of 1219 men reported spending some time on cooking and washing up.

What is a 95% confidence interval for the difference between the proportion of women and the proportion of men who spend some time on cooking and washing up during a typical day?

Question 10 options:

Question 11 (1 point)

A survey asked people who work full time, "How do you spend your time on a typical day?" 74% of 733 women and 55% of 1219 men reported spending some time on cooking and washing up.

Test, at significance level 0.05, that the proportion of women is greater than the proportion of men who spend some time on cooking and washing up during a typical day.

The test is

Question 11 options:

Question 12 (1 point)

A survey asked people who work full time, "How do you spend your time on a typical day?" 74% of 733 women and 55% of 1219 men reported spending some time on cooking and washing up.

Test, at significance level 0.05, that the proportion of women is greater than the proportion of men who spend some time on cooking and washing up during a typical day.

The p-value is

Question 12 options:

Question 13 (1 point)

A survey asked people who work full time, "How do you spend your time on a typical day?" 74% of 733 women and 55% of 1219 men reported spending some time on cooking and washing up.

Test, at significance level 0.05, that the proportion of women is greater than the proportion of men who spend some time on cooking and washing up during a typical day.

We can conclude that

Question 13 options:

In an article in Advertising Age, Nancy Giges studies global spending patterns. Giges presents data concerning the percentage of adults in various countries who have purchased various consumer items (such as soft drinks, athletic footware, blue jeans, beer, and so on) in the past three months. (Round answer to 4 decimal places.)

(a) Suppose we wish to justify the claim that fewer than 50 percent of adults in Germany have purchased blue jeans in the past three months. The survey reported by Giges found that 44 percent of the respondents in Germany had purchased blue jeans in the past three months. Note: The actual figure in the survey is different; the figure has been changed here for instructional purposes. Assume that a random sample of 405 German adults was employed, and let p be the proportion of all German adults who have purchased blue jeans in the past three months. If, for the sake of argument, we assume that p = .5, use the normal approximation to the binomial distribution to calculate the probability that 44 percent or fewer of 405 randomly selected German adults would have purchased blue jeans in the past three months. Note: Because 44 percent of 405 is 178, you should calculate the probability that 178 or fewer of 405 randomly selected German adults would have purchased blue jeans in the past three months. P

(b) Based on the probability you computed in part a, would you conclude that p is really less than .5?

That is, would you conclude that fewer than 50 percent of adults in Germany have purchased blue jeans in the past three months? Yes No

The United States, a large open economy has substantially increased government spending and decreased taxes during the early 1980s. Not only has that changed national saving in the United States, but also in the rest of the world.

(a) What was the consequence for the world real interest rate?

(b) What was the consequence of the US policy on Norway, a small open economy? Use a model of a long-run small open economy with perfect capital mobility to discuss what happened to domestic saving, investment and interest rates in Norway.

Bank of America's Consumer Spending Survey collected data on annual credit card charges in seven different categories of expenditures: transportation, groceries, dining out, household expenses, home furnishings, apparel, and entertainment (U.S. Airways Attache, December 2003). Using data from a sample of 42 credit card accounts, assume that each account was used to identify the annual credit card charges for groceries (population 1) and the annual credit card charges for dining out (population 2). Using the difference data, the sample mean difference was    = $872, and the sample standard deviation was sd = $1,119.

Formulate the null and alternative hypotheses to test for no difference between the population mean credit card charges for groceries and the population mean credit card charges for dining out.
H0:  d Selectgreater than or equal to 0greater than 0less than or equal to 0less than 0equal to 0not equal to 0Item 1  
Ha:  d Selectgreater than or equal to 0greater than 0less than or equal to 0less than 0equal to 0not equal to 0Item 2  

Use a .05 level of significance. What is the p-value?
The p-value is Selectless than .01between .01 and .02between .02 and .05between .05 and .10between .10 and .20between .20 and .40greater than .40Item 3  

Can you conclude that the population means differ?
SelectThere is a difference between the annual mean expendituresCannot conclude there is a difference between the annual mean expendituresItem 4  

Which category, groceries or dining out, has a higher population mean annual credit card charge?
SelectGroceriesDining outItem 5  

What is the point estimate of the difference between the population means?
$   

What is the 95% confidence interval estimate of the difference between the population means (to the nearest whole number)?
(  ,   )