Statistical Methods and Hypothesis Testing in Economic and Production Analysis

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Statistical Methods and Hypothesis Testing in Economic and Production Analysis Question 1 [4 marks] Consider the following information. 2000 2003 Item Price Quantity Price Quantity A $ .25 210 $ .37 210 B .87 2 1.15 2 C 10.00 4 15.00 4 D .35 35 .60 35 a. Compute the Laspeyres index. Ans: = (0.37 x 210 + 1.15 x 2 + 15 x 4 + 0.60 + 35)/(0.25 x 210 + 0.87x 2 + 10 x 4 + 0.35 x 35) = 161/106.49 = 1.512=151.188% 151.188 % b. Compute the Paasche index. Ans: (0.37 x 210 + 1.15 x 2 + 15 x 4 + 0.60 + 35)/(0.25 x 210 + 0.87x 2 + 10 x 4 + 0.35 x 35) = 1.512 151.188 % c. Comment on your answers for Parts c and d. Ans: They are the same since quantity is the same for both years.
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Question 2 [6 marks] The following time series shows the sales of a clothing store over a 10 - week period. Sales Week ($1,000s) 1 15 2 16 3 19 4 18 5 19 6 20 7 19 8 22 9 15 10 21 a. Compute a 4 - week moving average for the above time series.

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