Question (a)

(Select x1 x2 y1 y2 > Open Group > View > Descriptive Stats > Common sample)
X1 X2 Y1 Y2
Mean 53.00769 53.26154 81.03846 82.70000
Median 44.90000 45.20000 84.20000 86.00000
Maximum 114.9000 114.5000 105.4000 105.1000
Minimum 13.10000 13.70000 50.50000 54.20000
Std. Dev. 33.88065 33.68158 15.92262 14.75507

Question (b)

X1 Y1
(Select x1 y1 > Open Group > View > Covariance analysis > Tick correlation and untick
covariance)
X1 Y1
X1 1.000000 0.941745
Y1 0.941745 1.000000

Correlation for output per hour, business sector and compensation per hour, business sector =
0.9417.
Output per hour, business sector and compensation per hour, business sector are highly
positive correlated.

X2 Y2
(Select x2 y2 > Open Group > View > Covariance analysis > Tick correlation and untick
covariance)

X2 Y2
X2 1.000000 0.936865
Y2 0.936865 1.000000

Correlation for output per hour, nonfarm business sector and compensation per hour, nonfarm
business sector = 0.9369.
Output per hour, nonfarm business sector and compensation per hour, nonfarm business sector
are also highly positive correlated.
 Question (c)
(Select Y1 Y2 > Open Group > View > Graph > Line & Symbol > Change name on Y1 & Y2)

110

100

90

80

70

60

50
1960 1965 1970 1975 1980 1985 1990 1995

Y1 = output per hour, business sector

Y2 = output per hour, nonfarm business sector

Question (d)

Scatter diagram with Y1 against X1:

(Select X1 first then Y1 > Open Group > View > Graph > Scatter > Change name on Y1 & X1)

110
Y1 = output per hour, business sector

100

90

80

70

60

50
0 20 40 60 80 100

X1 = compensation per hour, business sector

Scatter diagram with Y2 against X2:
(Select X2 first then Y2 > Open Group > View > Graph > Scatter > Change name on Y2 & X2)

110
Y2 = output per hour, nonfarm business sector

100

90

80

70

60

50
0 20 40 60 80 100 120

X2 = compensation per hour, nonfarm business

Question (e)

Y1 X1
(Select y1 first then x1 > Open Equation > y1 c x1 > Copy and paste as displayed)

Dependent Variable: Y1
Method: Least Squares
Date: 06/22/17 Time: 15:06
Sample: 1959 1997
Included observations: 39

Variable Coefficient Std. Error t-Statistic Prob.

C 57.57808 1.628641 35.35346 0.0000

X1 0.442584 0.025985 17.03226 0.0000

R-squared 0.886884 Mean dependent var 81.03846

Adjusted R-squared 0.883827 S.D. dependent var 15.92262
S.E. of regression 5.427096 Akaike info criterion 6.270606
Sum squared resid 1089.775 Schwarz criterion 6.355917
Log likelihood -120.2768 Hannan-Quinn criter. 6.301215
F-statistic 290.0977 Durbin-Watson stat 0.075997
Prob(F-statistic) 0.000000

Output per hour (business sector) = 57.5781+0.4426 compensation per hour (business sector) +

R-squared = 0.8869
Y2 X2
(Select y2 first then x2 > Open Equation > y2 c x2 > Copy and paste as displayed)

Dependent Variable: Y2
Method: Least Squares
Date: 06/22/17 Time: 15:10
Sample: 1959 1997
Included observations: 39

Variable Coefficient Std. Error t-Statistic Prob.

C 60.84054 1.581252 38.47619 0.0000

X2 0.410417 0.025185 16.29638 0.0000

R-squared 0.877715 Mean dependent var 82.70000

Adjusted R-squared 0.874410 S.D. dependent var 14.75507
S.E. of regression 5.229000 Akaike info criterion 6.196237
Sum squared resid 1011.670 Schwarz criterion 6.281548
Log likelihood -118.8266 Hannan-Quinn criter. 6.226846
F-statistic 265.5721 Durbin-Watson stat 0.083324
Prob(F-statistic) 0.000000

Output per hour (nonfarm business sector) = 60.8405+ 0.4104 compensation per hour (nonfarm business sector) +

R-squared = 0.8777

Question (f)

When compensation (X1) increases 1 unit, output (Y1) in business sector increases 0.4426 unit.
When compensation (X1) decreases 1 unit, output (Y1) in business sector decreases 0.4426 unit.

Or

When compensation (X1) increases 1 unit, output (Y1) in business sector increases 0.4426 unit,
vice versa.

When compensation (X2) increases 1 unit, output (Y2) in nonfarm business sector increases
0.4104 unit.
When compensation (X2) decreases 1 unit, output (Y2) in nonfarm business sector decreases
0.4104 unit.

Or

When compensation (X2) increases 1 unit, output (Y2) in nonfarm business sector increases
0.4104 unit, vice versa.
Question (g)
For X1 and Y1
R-squared = 0.8869
88.69% of compensation per hour for business sector (X1) explains output per hour for business
sector (Y1).

For X2 and Y2
R-squared = 0.8777
87.77% of compensation per hour for nonfarm business sector (X2) explains output per hour for
nonfarm business sector (Y2).

Question (h)

Y1 X1(Select y1 first then x1 > Open Equation > y1 c x1 >View > Actual, Fitted, Residual
Table)
obs Actual Fitted Residual Residual Plot
1959 50.5000 63.3759 -12.8759 |* . | . |
1960 51.4000 63.6415 -12.2415 |* . | . |
1961 53.2000 63.8628 -10.6628 | * . | . |
1962 55.7000 64.1283 -8.42833 | * . | . |
1963 57.9000 64.3939 -6.49388 | *. | . |
1964 60.6000 64.7479 -4.14795 | .* | . |
1965 62.7000 65.0135 -2.31350 | . *| . |
1966 65.2000 65.5003 -0.30034 | . * . |
1967 66.6000 65.9429 0.65707 | . |* . |
1968 68.9000 66.6511 2.24894 | . |* . |
1969 69.2000 67.2707 1.92932 | . |* . |
1970 70.6000 68.0231 2.57693 | . |* . |
1971 73.6000 68.6870 4.91305 | . | * |
1972 76.0000 69.3951 6.60491 | . | .* |
1973 78.4000 70.4130 7.98697 | . | .* |
1974 77.1000 71.6523 5.44773 | . | * |
1975 79.8000 73.1128 6.68720 | . | .* |
1976 82.5000 74.4848 8.01519 | . | . * |
1977 84.0000 75.8126 8.18744 | . | . * |
1978 84.9000 77.4501 7.44988 | . | .* |
1979 84.5000 79.3532 5.14676 | . | * |
1980 84.2000 81.6989 2.50107 | . |* . |
1981 85.8000 83.9561 1.84389 | . |* . |
1982 85.3000 85.9477 -0.64774 | . *| . |
1983 88.0000 87.1427 0.85728 | . |* . |
1984 90.2000 88.4262 1.77378 | . |* . |
1985 91.7000 89.9310 1.76900 | . |* . |
1986 94.1000 91.5686 2.53143 | . |* . |
1987 94.0000 92.8963 1.10368 | . |* . |
1988 94.7000 94.5781 0.12186 | . * . |
1989 95.5000 95.5961 -0.09608 | . * . |
1990 96.1000 97.7647 -1.66475 | . *| . |
1991 96.7000 99.6679 -2.96786 | .* | . |
1992 100.000 101.837 -1.83653 | . *| . |
1993 100.100 102.943 -2.84299 | .* | . |
1994 100.700 103.784 -3.08390 | .* | . |
1995 101.000 104.846 -3.84610 | .* | . |
1996 103.700 106.572 -2.87218 | .* | . |
 1997 105.400 108.431 -3.03103 | .* | . |
Y2 X2(Select y2 first then x2 > Open Equation > y2 c x2 >View > Actual, Fitted, Residual
Table)
obs Actual Fitted Residual Residual Plot
1959 54.2000 66.4633 -12.2633 |* . | . |
1960 54.8000 66.7095 -11.9095 |* . | . |
1961 56.6000 66.9147 -10.3147 | * . | . |
1962 59.2000 67.1610 -7.96097 | * . | . |
1963 61.2000 67.3662 -6.16618 | *. | . |
1964 63.8000 67.6945 -3.89451 | .* | . |
1965 65.8000 67.8997 -2.09972 | . *| . |
1966 68.0000 68.3101 -0.31014 | . * . |
1967 69.2000 68.7616 0.43840 | . * . |
1968 71.6000 69.3772 2.22278 | . |* . |
1969 71.7000 69.9518 1.74819 | . |* . |
1970 72.7000 70.6085 2.09152 | . |* . |
1971 75.7000 71.2651 4.43486 | . | *. |
1972 78.3000 71.9218 6.37819 | . | .* |
1973 80.7000 72.8247 7.87527 | . | . * |
1974 79.4000 74.0149 5.38506 | . | * |
1975 81.6000 75.3283 6.27173 | . | .* |
1976 84.5000 76.6006 7.89943 | . | . * |
1977 85.8000 77.8729 7.92714 | . | . * |
1978 87.0000 79.3914 7.60859 | . | .* |
1979 86.3000 81.1562 5.14380 | . | * |
1980 86.0000 83.3314 2.66859 | . | *. |
1981 87.0000 85.5477 1.45234 | . |* . |
1982 86.3000 87.3535 -1.05350 | . *| . |
1983 89.9000 88.4616 1.43837 | . |* . |
1984 91.4000 89.6518 1.74816 | . |* . |
1985 92.3000 90.9652 1.33483 | . |* . |
1986 94.7000 92.5248 2.17524 | . |* . |
1987 94.5000 93.7150 0.78503 | . |* . |
1988 95.3000 95.1925 0.10753 | . * . |
1989 95.8000 96.1364 -0.33643 | . * . |
1990 96.3000 98.0654 -1.76539 | . *| . |
1991 97.0000 99.8712 -2.87123 | .* | . |
1992 100.000 101.882 -1.88227 | . *| . |
1993 100.100 102.785 -2.68519 | .* | . |
1994 100.600 103.606 -3.00602 | .* | . |
1995 101.200 104.632 -3.43207 | .* | . |
1996 103.700 106.151 -2.45061 | . *| . |
1997 105.100 107.833 -2.73332 | .* | . |