Econometrics, Applied Statistics

Assignment Help:
Ask question From the household budget survey of 1980 of the Dutch Central Bureau of Statistics, J. S. Cramer obtained the following logit model based on a sample of 2820 households. (The results given here are based on the method of maximum likelihood and are after the third iteration.)** The purpose of the logit model was to determine car ownership as a function of (logarithm of) income. Car ownership was a binary variable: Y = 1 if a household owns a car, zero otherwise.

Li = —2.77231 + 0.347582 ln Income t = (—3.35) (4.05) X2(1 df) = 16.681 (p value = 0.0000)

where Li = estimated logit and where ln Income is the logarithm of income. The X 2 measures the goodness of fit of the model.

a. Interpret the estimated logit model.

b. From the estimated logit model, how would you obtain the expression for the probability of car ownership?

c. What is the probability that a household with an income of 20,000 will own a car? And at an income level of 25,000? What is the rate of change of probability at the income level of 20,000?

d. Comment on the statistical significance of the estimated logit model.

"Optional.

" J. S. Cramer, An Introduction to the Logit Model for Economist, 2d ed., published and distributed by Timberlake Consultants Ltd., 2001, p. 33. These results are reproduced from the statistical package PcGive 10 published by Timberlake Consultants, p#Minimum 100 words accepted#

Related Discussions:- Econometrics

Standard error, Standard Error The measure of reliability of the estima...

Standard Error The measure of reliability of the estimating equation that we have developed is given by standard error of estimate. The standard error of estimate represented b

Problem on standard deviation, Your organization purchases bottles of ...

Your organization purchases bottles of a popular commercial solvent for resale.  Each bottle is labeled as containing 32 fluid ounces of the solvent.  Your cont

Aviation legislation - SUPPLEMENTAL TYPE CERTIFICATION, JAR 21 SUPPLEMENTAL...

JAR 21 SUPPLEMENTAL TYPE CERTIFICATION JAR 21 Part E introduces the need for Supplemental Type Certification when a manufacturer wishes to make major changes to the Type Desig

Large-sample and small-sample simulations, Show that when h = h* for the h...

Show that when h = h* for the histogram, the contribution to AMISE of the IV and ISB terms is asymptotically in the ratio 2:1. Compare the sensitivity of the AMISE(ch) in Equa

Confidence interval, for this proportion, use the +-2 rule of thumb to dete...

for this proportion, use the +-2 rule of thumb to determine the 95 percent confidence interval. when asked if they are satisfied with their financial situation, .29 said "very sat

Comparison of the principal averages-mean, Comparison of the Principal Aver...

Comparison of the Principal Averages-Mean, Median and Mode The mean, median, and mode are located at the same point in a symmetrical frequency distri

Types of business forecasting , Types  of business forecasting  are genera...

Types  of business forecasting  are generally as follows: 1.      Sales  and Demand  forecasts 2.      Porduction  forecasts. 3.       Cost  Forecasts 4.       Financi

Explain survey development process, Problem: A survey usually originate...

Problem: A survey usually originates when an individual or an institution is confronted with an information need and the existing data are  insufficient. Planning the questionn

Stratified sampling, Stratified Sampling Stratified Sampling is ...

Stratified Sampling Stratified Sampling is generally used when the population is heterogeneous. In this case, the population is first subdivided into several parts (or s

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd