1 project i fall 2009. 2 3 4 5 bladder kidney leukemia lung
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11
Project IProject I
Fall 2009Fall 2009
22
33
44
55
2
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7
BLA
DD
ER
1
2
3
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5
KID
NE
Y
4
5
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9
LEU
KE
MIA
10
15
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25
30
2 3 4 5 6 7
BLADDER
LUN
G
1 2 3 4 5
KIDNEY
4 5 6 7 8 9
LEUKEMIA
10 15 20 25 30
LUNG
Bladder
Kidney
Leukemia
Lung
66
77
Question 1: Excel, Tools, data Question 1: Excel, Tools, data Analysis, Correlation Analysis, Correlation
R2 = r2 for bivariate case
F1, n-2 =[R2/1] ÷ [1-R2 ]/ (n-2) = 0.0784*42/0.9276
F1, 42 = 3.57, critical value @ 5% F1, 40 =4.08
88
EviewsEviews
Gen eff =@rfdist(1,42)Gen density=@dfdist(eff, 1, 42)
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Lung & Kidney CorrelationLung & Kidney Correlation
0
10
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0 5 10 15
EFF
DE
NS
ITY
4.08 critical3.57
Accept H0
1010
1111
Question 1: Excel, Tools, data Question 1: Excel, Tools, data Analysis, Correlation Analysis, Correlation
R2 = r2 for bivariate case
F1, n-2 =[R2/1] ÷ [1-R2 ]/ (n-2) = 0.0784*42/0.9276
F1, 42 = 3.57, critical value @ 5% F1, 40 =4.08
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a.
b.
Regression is significantEventhough R2 = 0.50,Other unspecified factorsAr work
Cigarettes smoked per Capita is significant, Prob.7/10,000 happen by chance
Coefficent 0.00445, if cigarettes smoked goes up by one per capita, death rate per 100,000 goes up by 0.004453
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If cigarettes smoked per capita goes up by about 1%, i.e. by25, then death rates for lung cancer go up by 25*0.0044 =0.11125 per 100, 000 or deaths per year increase by 11,125Or 0.11125/ 19.653, or about 0.6%. Called calculating elasticities at means
1919
Or run a log log regression to estimate elasticity of 0.7
2020
4. c4. c
0
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-8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8
Series: ResidualsSample 1 44Observations 44
Mean -2.36E-15Median 0.303458Maximum 7.963441Minimum -7.226050Std. Dev. 2.997614Skewness -0.105521Kurtosis 3.471883
Jarque-Bera 0.489888Probability 0.782748
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Copy fitted
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Paste into a open group windowAfter selecting edit
2525
-10
-5
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10 15 20 25 30
FITTED
RE
SID
2.8*10-12
4. d4. d
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White Test for HeteroskedasticityWhite Test for Heteroskedasticity
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In ExcelIn Excel
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4e.
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Q 4e: Do DC and Nevada Bias Q 4e: Do DC and Nevada Bias Results?Results?
Lung Cancer Death Rates Per 100,000 People By State, 1960
Utah
LaDC
Nev
y = 0.0053x + 6.4717
R2 = 0.4864
0
5
10
15
20
25
30
35
0 500 1000 1500 2000 2500 3000 3500 4000 4500
Cigarettes Smoked Per Capita
De
ath
Ra
tes
3939
4040
4141
a
b
4242
5.C Are Residuals Normal?5.C Are Residuals Normal?
0
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-1.5 -1.0 -0.5 0.0 0.5 1.0 1.5
Series: ResidualsSample 1 44Observations 44
Mean 1.49E-15Median 0.057038Maximum 1.308862Minimum -1.627497Std. Dev. 0.666564Skewness -0.026203Kurtosis 2.795929
Jarque-Bera 0.081384Probability 0.960125
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5.d5.d
-2
-1
0
1
2
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FITTEDBLADR
RE
SID
4444
Bladder Cancer and CigarettesBladder Cancer and CigarettesBladder Cancer Death Rates Per 100,000 Vs. Cigarettes Smoked Per Capita, 1960
Aka
Wisc
NJ
Nev
Mont
0
1
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7
0 500 1000 1500 2000 2500 3000 3500 4000 4500
Cigarettes Smoked Per Capita
Bla
dd
er
Ca
nc
er
De
ath
Ra
te
4545
66cigarettes smoked per capita Vs, Income Per Capita By State 1960
AZ
Utah
DCNev
y = 0.9057x + 532.66
R2 = 0.5261
0
500
1000
1500
2000
2500
3000
3500
4000
4500
0 500 1000 1500 2000 2500 3000 3500
Income Per Capita $
Cig
are
tte
s P
er
Ca
pit
a
4646
77
a
b
4747
7. C Are the Residuals Normal?7. C Are the Residuals Normal?
0
2
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-8 -6 -4 -2 0 2 4 6 8
Series: ResidualsSample 1 44Observations 44
Mean -2.88E-15Median 0.166719Maximum 8.014785Minimum -7.153882Std. Dev. 2.888455Skewness 0.017645Kurtosis 3.731293
Jarque-Bera 0.982730Probability 0.611791
4848
Economic and Health SignificanceEconomic and Health Significance• Smoking is hazardous to your health, especially
for lung, bladder and Kidney cancer• Intensity of smoking, e.g cigarettes smoked per
dollar of income and income per capita affect lung cancer death rates– Smoking intensity may be reduced by advertising
health hazards and by imposing an excise tax– Development, as measured by income per capita may
create dangerous toxins that cause lung cancer, e.g. acid rain from coal smoke stacks, particlates in the air, smog etc.
4949
Beyond The ProjectBeyond The Project
5050
Lung = a{[(cigs/pop)/(Inc/pop)][Inc/pop]}b exp(e)lnLung = lna + b* cigs/$ + b*(Inc/pop) + elnLung = lna + b*(cigs/pop) – b*(inc/pop) + b(inc/pop) + elnLung = lna + b*(cigs/pop) + e
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5252
Bladder Cancer Rate
Lung Cancer Rate
Kidney cancer Rate
Cigarettes/pop Income/pope
eK
eL
eB
Conjecture for 1960