(a) Does the probability of passing the test depend on Experience? Explain. (b) Matthew has 10 years of driving experience. What is the probability that he will pass the test? (c) Christopher is a new driver (zero years of experience). What is the probability that he will pass the test?

(a) Does the probability of passing the test depend on Experience? Explain. (b) Matthew has 10 years of driving experience. What is the probability that he will pass the test? (c) Christopher is a new driver (zero years of experience). What is the probability that he will pass the test?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

100%

Dependent Variable: Pass
Experience
Male
Malex Experience
Constant
Probit
Logit
(1)
(2)
0.031
0.040
(0.009) (0.016)
0.712
(0.126)
Linear
Probability
(3)
0.006
(0.002)
1.059
0.774
(0.221) (0.034)
Probit
(4)
-0.333
(0.161)
1.282
(0.124)
Logit
(5)
-0.622
(0.303)
2.197
(0.242)
Linear
Probability
(6)
-0.071
(0.034)
0.900
(0.022)
Probit
(7)
0.041
(0.156)
-0.074
(0.259)
-0.015
(0.019)
0.806
(0.200)
Problem 1. (~SW 11.2) Using the results of column (2):
(a) Does the probability of passing the test depend on Experience? Explain.
(b) Matthew has 10 years of driving experience. What is the probability that he will pass the test?
(c) Christopher is a new driver (zero years of experience). What is the probability that he will pass
the test?
(d) Sketch the predicted probabilities from the probit and logit regressions in column (1) and (2)
for values of Experience between 0 and 60. Are the probit and logit models similar?

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