1. For a particular hypothesis test, α=0.05, and β=0.10.

The power of this test is:

 0.15
 0.90
 0.85
 0.95

2. Equality of several normal population means can be tested by:

 Bartlett’s Test
 F-test
 χ2-test
 t-test

3. When the null hypothesis is accepted, it is possible that:

 A correct Decision has been Made

 A Type-II Error has been Made
 Both (A) and (B) have Occurred
 Neither (A) nor (B) has Occurred

4. To test the randomness of a sample, the appropriate test is:

 Run Test
 Sign Test
 Median Test
 Page’s Test

5. The set of equations obtained in the process of least square estimation are called:

 Normal Equations
 Intrinsic Equations
 Simultaneous Equations
 All of the Above

6. The sign test assumes that the:

 Samples are Independent

 Samples are Dependent

 Samples have the Same Mean
 None of These

7. Power of test is related to:

 Type-I Error
 Type-II Error
 Type-I and Type-II Error Both
 None of the Above

8. Most of the Non-Parametric methods utilize measurements on:

 Interval Scale
 Ratio Scale
 Ordinal Scale
 Nominal Scale

9. Parameters are those constants which occur in:

 Samples
 Probability Density Functions
 A Formula
 None of these

10. Homogeneity of several variances can be tested by:

 Bartlett’s Test
 Fisher’s Exact Test
 F-test
 t-test

Question was not answered

11. With a lower significance level, the probability of rejecting a null hypothesis that is
actually true:

 Decreases
 Remains the Same
 Increases
 All of the Above

1. A quantity obtained by applying a certain rule or formula is known as

 Test Statistics
 Estimate
 Estimator
 Estimation

2. Criteria to check a point estimator to be good are

 Consistency
 Efficiency
 All of the options
 Unbiasedness

3. If n1=16, n2=9 and α=0.01, then tα2 will be

 3.767
 2.807
 2.797
 2.787

4. If the sample average x― is an estimate of the population mean μ, then x― is:

 Biased and Efficient

 Unbiased and Inefficient
 Biased and Inefficient
 Unbiased and Efficient

5. Sample median as an estimator of the population mean is always

 Efficient
 Unbiased
 Sufficient
 None of all these

6. By the method of moments one can estimate:

 All of the options

 All Constants of a Population
 Only Mean and Variance of a Distribution
 All Moments of a Population Distribution

7. An estimator Tn is said to be a sufficient statistic for a parameter function τ(θ) if it

contained all the information which is contained in the:

 Parametric Function τ(θ)

 Sample
 None of these
 Population

8. Crammer-Rao inequality is valid in the case of:

 None of these
 Lower Bound on the Variance
 Upper Bound on the Variance
 The Asymptotic Variance of an Estimator
 9. The consistency of an estimator can be checked by comparing

 Mean
 Standard Deviation
 Variance
 Mean Square

10. For an estimator to be consistent, the unbiasedness of the estimator is

 Necessary
 Neither Necessary nor Sufficient
 Sufficient
 None of these

11. If α=0.10 and n=15 then tα2 will be

 2.145
 1.771
 1.761
 1.753

12. Roa-Blackwell Theorem enables us to obtain minimum variance unbiased estimator

through:

 Complete Statistics
 Sufficient Statistics
 Unbiased Estimators
 Efficient Statistic

If a researcher uses daily data to examine a particular problem and creates a variable tha
what term would best describe this type of number?

a) Continuous

b) Cardinal

c) Ordinal

d) Nominal
2 The price of a house is best described as what type of number?

a) Discrete

b) Cardinal

c) Ordinal

d) Nominal

3 Which of the following is NOT a feature of continuously compounded returns

(i.e. log-returns)?

a) They can be interpreted as continuously compounded changes in the prices

b) They can be added over time to give returns for longer time periods

c) They can be added across a portfolio of assets to give portfolio returns

d) They are usually fat-tailed

4 Which of the following are alternative names for the dependent variable

(usually denoted by y) in linear regression analysis?

(i) The regressand

(ii) The regressor

(iii) The explained variable

(iv) The explanatory variable

 a) (ii) and (iv) only

b) (i) and (iii) only

c) (i), (ii), and (iii) only

d) (i), (ii), (iii), and (iv)

5 Which of the following are alternative names for the independent variable

(usually denoted by x) in linear regression analysis?

(i) The regressor

(ii) The regressand

(iii) The causal variable

(iv) The effect variable

a) (ii) and (iv) only

b) (i) and (iii) only

c) (i), (ii), and (iii) only

d) (i), (ii), (iii), and (iv)

6 Which of the following statements is TRUE concerning the standard regression

model?
 a) y has a probability distribution

b) x has a probability distribution

c) The disturbance term is assumed to be correlated with x

d) For an adequate model, the residual (u-hat) will be zero for all sample data points

7 Which of the following statements is TRUE concerning OLS estimation?

a) OLS minimises the sum of the vertical distances from the points to the line

b) OLS minimises the sum of the squares of the vertical distances from the points to t

c) OLS minimises the sum of the horizontal distances from the points to the line

d) OLS minimises the sum of the squares of the horizontal distances from the points t

8 The residual from a standard regression model is defined as

a) The difference between the actual value, y, and the mean, y-bar

b) The difference between the fitted value, y-hat, and the mean, y-bar

c) The difference between the actual value, y, and the fitted value, y-hat

d) The square of the difference between the fitted value, y-hat, and the mean, y-bar

9 Which one of the following statements best describes the algebraic representation

of the fitted regression line?

 a)

b)

c)

d)

10 Which of the following statements concerning the regression population and

sample is FALSE?

a) The population is the total collection of all items of interest

b) The population can be infinite

c) In theory, the sample could be larger than the population

d) A random sample is one where each individual item from the population is equa

11 Which of the following statements is true concerning the population regression

function (PRF) and sample regression function (SRF)?

a) The PRF is the estimated model

b) The PRF is used to infer likely values of the SRF

c) Whether the model is good can be determined by comparing the SRF and the P
 d) The PRF is a description of the process thought to be generating the data.

12 Which of the following models can be estimated using OLS, following suitable

transformations if necessary? (Note that "e" denotes the exponential).

i)

ii)

iii)

iv) .

a) (i) only

b) (i) and (iii) only

c) (i), (iii), and (iv) only

d) (i), (ii), (iii), and (iv)

13 Which of the following is an equivalent expression for saying that the explanatory

variable is "non-stochastic"?

a) The explanatory variable is partly random

b) The explanatory variable is fixed in repeated samples

 c) The explanatory variable is correlated with the errors

d) The explanatory variable always has a value of one

14 If an estimator is said to be consistent, it is implied that

a) On average, the estimated coefficient values will equal the true values

b) The OLS estimator is unbiased and no other unbiased estimator has a smaller v

c) The estimates will converge upon the true values as the sample size increases

d) The coefficient estimates will be as close to their true values as possible for sma

15 If an estimator is said to have minimum variance, which of the following

statements is NOT implied?

a) The probability that the estimate is a long way away from its true value is minimi

b) The estimator is efficient

c) Such an estimator would be termed "best"

d) Such an estimator will always be unbiased

16 Consider the OLS estimator for the standard error of the slope coefficient.

Which of the following statement(s) is (are) true?

(i) The standard error will be positively related to the residual variance
 (ii) The standard error will be negatively related to the dispersion of the observatio

(iii) The standard error will be negatively related to the sample size

(iv) The standard error gives a measure of the precision of the coefficient estimate.

a) (ii) and (iv) only

b) (i) and (iii) only

c) (i), (ii), and (iii) only

d) (i), (ii), (iii), and (iv)

17 Which of the following statements is INCORRECT concerning the classical

hypothesis testing framework?

a) If the null hypothesis is rejected, the alternative is accepted

b) The null hypothesis is the statement being tested while the alternative encompa

c) The test of significance and confidence interval approaches will always give the

d) Hypothesis tests are used to make inferences about the population parameters.

18 Suppose that a hypothesis test is conducted using a 5% significance level.

Which of the following statements are correct?

(i) The significance level is equal to the size of the test

(ii) The significance level is equal to the power of the test

 (iii) 2.5% of the total distribution will be in each tail rejection region for a 2-sided t

(iv) 5% of the total distribution will be in each tail rejection region for a 2-sided tes

a) (ii) and (iv) only

b) (i) and (iii) only

c) (i), (ii), and (iii) only

d) (i), (ii), (iii), and (iv)

19 Consider an identical situation to that of question 21, except that now a 2-sided

alternative is used. What would now be the appropriate conclusion?

a) H0 is rejected

b) H0 is not rejected

c) H1 is rejected

d) There is insufficient information given in the question to reach a conclusion

20 Which one of the following would be the most appropriate as a 95% (two-sided)

confidence interval for the intercept term of the model given in question 21?

a) (-4.79,2.19)

b) (-4.16,4.16)
 c) (-1.98,1.98)

d) (-5.46,2.86)

21 Which one of the following is the most appropriate definition of a 99% confidence

interval?

a) 99% of the time in repeated samples, the interval would contain the true value o

b) 99% of the time in repeated samples, the interval would contain the estimated v

c) 99% of the time in repeated samples, the null hypothesis will be rejected

d) 99% of the time in repeated samples, the null hypothesis will not be rejected wh

22 Which one of the following statements best describes a Type II error?

a) It is the probability of incorrectly rejecting the null hypothesis

b) It is equivalent to the power of the test

c) It is equivalent to the size of the test

d) It is the probability of failing to reject a null hypothesis that was wrong

23 Suppose that a test statistic has associated with it a p-value of 0.08. Which

one of the following statements is true?

(i) If the size of the test were exactly 8%, we would be indifferent between rejectin
 (ii) The null would be rejected if a 10% size of test were used

(iii) The null would not be rejected if a 1% size of test were used

(iv) The null would be rejected if a 5% size of test were used.

a) (ii) and (iv) only

b) (i) and (iii) only

c) (i), (ii), and (iii) only

d) (i), (ii), (iii), and (iv)

24 Suppose that observations are available on the monthly bond prices of 100

companies for 5 years. What type of data are these?

a) Cross-sectional

b) Time-series

c) Panel

d) Qualitative

1. What does a simple linear regression analysis examine?

a. The relationship between only two variables

b. The relationship between one dependent and one independent variable
c. The relationship between many
variables
d. The relationship between two dependent and one independent variable

Answer:

a. The relationship between only two variables

c. The relationship between many variables

2. Which of the following are correct?

a. The intercept/constant (β0) is the mean-Y when X=0

b. The intercept is the the amount of change in mean-Y when
X=0
c. The coefficient is the mean-Y at a certain value of
X
d. The coefficient (β) is the amount of change in mean-Y for every unit
increase in X

Answer:

a. The intercept/constant (β0) is the mean-Y when X=0

d. The coefficient (β) is the amount of change in mean-Y for every unit increase
in X

3. What does the least squares method do exactly?

a. Minimizes the distance between the data points

b. Finds the least problematic regression line
c. Finds those (best) values of the intercept and slope that provide us with
the smallest value of the residual sum of squares
d. Finds those (best) values of the intercept and slope that provide us with
the smallest value of the sum of residuals

Answer:

c. Finds those (best) values of the intercept and slope that provide us with the
smallest value of the residual sum of squares

4. Which of the following measures is optimal for comparing the goodness of the
fit of competing regression models involving the same dependent variable?

a. The
intercept
 b. The
coefficient

c. R-square
d. Standard deviation of the
residuals

Answer:

d. Standard deviation of the residuals

5. What does the following expression (H0: 1 = 0) mean?

a. Mean-Y changes as as a result of a change

in X
b. Mean-Y does not change as a result of a change in X
c. Mean-Y value becomes 0 as a result of a change
in X
d. Mean-Y value is equal to 0 when X=0

Answer:

b. Mean-Y does not change as a result of a change in X