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ECM712S-ECONOMETRICS-2ND OPP-JULY 2025 |
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n Am I BI A u n IVER s I TY
OF SCIEn CE Ano TECHn OLOGY
FACULTY OF COMMERCE, HUMAN SCIENCESAND EDUCATION
DEPARTMENT OF ECONOMICS, ACCOUNTING AND FINANCE
QUALIFICATION: BACHELOR OF ECONOMICS
QUALIFICATION CODE: 12BECO
LEVEL: 7
COURSE CODE: ECM712S
COURSE NAME: ECONOMETRICS
SESSION: JULY2025
DURATION: 3 HOURS
PAPER: THEORY
MARKS: 100
SECOND OPPORTUNITY EXAMINATION QUESTION PAPER
EXAMINER(S)
MR EDEN TATE SHIPANGA
MODERATOR:
MR. GEBHARD LUCKY SHIGWEDHA
INSTRUCTIONS
1. Answer ALL the questions.
2. Write clearly and neatly.
3. Number the answers clearly.
PERMISSIBLE MATERIALS
1. PEN,
2. PENCIL
3. CALCULATOR
THIS QUESTION PAPER CONSISTS OF 2 PAGES (Including this front page)
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QUESTION1 [25 marks]
1. What is econometrics
(5)
2. With proper examples draw a distinction between mathematical and econometric model?
(4)
3. Discussthe two types of error that arise in hypothetical conclusions
(8)
4. Define the stochastic disturbance term and three reasons why it exists?
(8)
QUESTION2 [25 marks]
1. Descrr'bet he vari.ous components of t he f uncti.on y' = E(YI X)' + ,L'L.
(2)
2. Discussthe two types of error that arise in hypothetical conclusions
(6)
3. State the two distinct features of the interceptless model.
(4)
4. One of the "consequences of error of measurement in the regressand is increased variance of the estimators".
Formulate a scenario and provide proof of this statement.
(4)
5. Consider a two-variable model where consumption as a regressand and income as a regressor.
(a) Name the parameter that is used to measure the spread of the values from their expected values? (2)
(b) Suppose, a researcher is interested in measuring the strength of the relationship between consumption and
income, name the parameter one can use to quantify this relationship?
(2)
= 6. Assuming. a three-variable model Yt a 1 + a 2X2 + a 3X3, where a 2 and a 3 are partial regression
coefficients. You h·avebeen asked in a job interview to briefly describe the meaning of the two parameters in
this context·.
·
(5)
QUESTION3 [25 marks]
i
1. Discuss any of the three CLRM assumptions uncferlying the method of least squares?
(6)
/J 2. Show that the.QLS slope coefficient estimator 2 is linear function of }'i sample value?
(4)
3. Convert the f~llowing intrinsically functions. into linear equations.
1
(a)
yt ·= e/31+/32Xc+uc
'· •
(5)
(b)
Yt. -- 1 +efli +iP2Xc+ut
(5)
(c)
GJ = + Yt /31 /32
+ Ut
(5)
QUESTION 4 !25 marks!
1. Interpret the intercept and slope coefficients of the following regression. }~ = 56.1 -1.7 X;where Y=% of vote
received by the incumbent president and X= unemployment rate (in percentage points)
(5)
2. Interpret the intercept and slope coefficients of the following regression. In}~ = 3.5 + 1.35 In X; where Y= GNP
(in millions of$) X= Government spending (in mills. of dollars)
(5)
3. Interpret the intercept and slope coefficients of the following regression. Y; = -1.8 + 45.8 In X;where Y=inflation
rate(%) and X= wage rate (in N$)
(5)
4. Interpret the intercept and slope coefficients of the following regression. In Y; = 4.1 + 0.05 T where Y=GDP(in
mill. of dollars) and T=time trend (T=l,2,3, representing years)
(5)
5. Interpret the intercept and slope coefficients of the following compound growth rate of In Y; = 4.1 + 0.05 T
where Y=GDP(in mill. of dollars) and T=time trend (T=l,2,3, representing years)
(5)
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