Download Econ 424 Fall 2008 Midterm: Lottery Winning & Foreclosure Rates Analysis - Prof. Zhe Jin and more Exams Economics in PDF only on Docsity! Econ 424 Fall 2008 Session #2 Name: ______________________ Midterm Exam Student ID: ___________________ Econ 424 Fall 2008 Session #2 Midterm Exam This is an open book exam, you can consult any paper or electronic material, but you must complete the exam independently. This exam has 5 pages and 100 points in total. If you need more space, feel free to write answers on the back. In that case, remember to make a clear reference to the question number. Please use confidence level 95% for any statistical test mentioned in the exam. For non- integer answers, keep 3 decimal points. 1. [15 points] Massachusetts State Lottery office wants to determine the lottery winners of the MEGABUCKS. The winning rate is pre-set at one out of 5,245,786. Given a list of ticket numbers, you will use an excel function to generate a random draw of 1 (win) or 0 (lose) for each ticket. Which excel command(s) would you use? (Note: If you are going to use multiple commands in a sequence, please be clear how to carry them out one by one.) _____________________________________________________________________ _____________________________________________________________________ ____________________________________________________________________. 2. [10 points] According to the Central Limit Theorem, for a sample of 2000 independent draws out of a uniform distribution on (-5,7), what distribution should the sample mean conform to? __________________________________________________. (Hint: You must specify the type of distribution and calculate the parameters for this distribution). 1 Econ 424 Fall 2008 Session #2 Name: ______________________ Midterm Exam Student ID: ___________________ 3. [75 points] RealtyTrac.com keeps track of state-by-state foreclosure rate every month since June 2006. Pooling the monthly announcements between June 2006 and July 2007, Midterm-Fall2008.xls displays foreclosure rate for MD, VA, and the US as a whole. Because only a fraction of houses were foreclosed in any month and it is hard to compare many decimal points, RealtyTrac defines foreclosure rate as "1 in how many houses was foreclosed." For example, if the foreclosure rate is equal to 1000, that means 1 in every 1000 houses was disclosed (in the corresponding month and state). By this definition, the LOWER the foreclosure rate, the MORE disclosures have occurred. More specifically, we have the following variables: YearMonth -- Calendar year and month (e.g. 200606) ForecloseMD -- Foreclosure rate of MD ForecloseVA -- Foreclosure rate of VA ForecloseUS -- Foreclosure rate of the US as a whole (1) How many YearMonths do we observe in total? _______________________________ Based on ForecloseUS, which YearMonth is the worst in foreclosure? (note that worst foreclosure implies the lowest number in foreclosure rate.) ________________________________________ Which YearMonth has the worst ForecloseVA in this data set? __________________________________________ Which YearMonth has the best ForecloseVA in this data set? ________________________________________________ How much is the worst ForecloseMD in this data set? ____________________________________________ In how many YearMonths does ForecloseVA appear better than ForecloseMD? (note that better foreclose implies a greater number in foreclosure rate). ____________________________________________________________ (Note: In case more than one answer applies, write down all of them.) 2
