Assignment – Measurements in Economics

 Assignment details:

 

(Most of the work should be done on an excel – questions will state when do add to word document)

 

1. Hedonic regression.

I have created a new dataset for bathroom fan project. As a first step you will run the following regressions:

1. a) Dependant variable: Price; Independent variable: CFM
2. b) Dependant variable: Price; Independent variables: CFM, and Sones
3. c) Dependant variable: Price; Independent variables: CFM, Sones, Light, Star, Sensor, and warranty
4. d) Dependant variable: Ln Price; Independent variables: CFM, Sones, Light, Star, Sensor, and warranty
5. e) Based on the version where the dependant variable is price, what is the interpretation of the coefficient for sensor?

—- Include your answers in the template.  —-

 

2. Draw a scatter plot with the regression line where the price appears on the y-axis and the sones appear on the x-axis.

—- Include your graph in main Word document.  —-

 

3. 3. As the last step and using the hedonic model derived in c), predict the price of a bathroom fan with the following features:

3 sones, 1 light, 75 CFM, no energy star, and has a 2-year warranty.

(Show your calculations.)

—- Include your answers in the main Word document and show your steps.  —-

 

4. Find the FRED database and download the annual all-items CPIs for China, Zimbabwe, and Canada for the period 1993 to the latest available period which is common to these countries. Create a Table where all three indices are presented with base 1993 = 100. Then draw a graph of the Chinese CPI against the Canadian CPI. Now draw another graph comparing the Zimbabwean CPI against the Canadian CPI. Cut and paste the table and the graphs in your main document.

 

 

 

 

 

5. Openness
6. Using annual data, produce a line chart for a new series that goes by the name of Degree of Canadian Trade Openness (DCTO)for the period 1981 to 2016. Trade openness is defined as ([Total exports of goods and services + Total imports of goods and services]/GDP). This national accounting data are downloadable from CANSIM and should be expressed at current prices and on an annual basis. Use the expenditure approach to estimating GDP for constructing this new series. You might have to do some digging in CANSIM to find these data (Hint: the title of the series contains the words “provincial and territorial”. Once you have found the series, look closely at the options you are being offered (e.g., chained dollars or current prices) and choose the correct series. Furthermore, you are looking for exports of goods and services; choose imports from other countries and exports to other countries, do not choose anything related to imports and exports to and from the provinces.
7. Once you have the series, construct the Index of openness in such a way that its value is 100 for the base year (1981 = 100). Include the table and draw a graph. The table should have columns showing exports, imports, GDP, the computed values for openness, and your computed index. It is this index that should be used for constructing your line chart. Don’t forget to adjust the height of the y-axis to dramatize the results a bit!
8. By analysing the chart, what can you say about the general behaviour of the openness index over the period?
9. Can you think of two political or economic events that may explain the impressive increase (spike) in this index during most of the 1990s?

— Include Table and graphs in the main Word document.  —-

 

6. Go to any source and extract the same basic data as above (i.e., current price GDP, exports and imports of goods and services) for the following countries: Canada, France, UK, and China but only for 2015. From these data, calculate in % the degree of openness ((imports + exports)/ GDP x 100) of each of these countries for 2015. Present the data in a Table and draw a column graph. Don’t forget to adjust the height of the y-axis to dramatize the results a bit!