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20 Cards in this Set
- Front
- Back
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What are the 3 main branches of economic statistics? |
- Micro - Macro - Econometrics |
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What are the two types of statistics? |
Descriptive and Inferential |
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What is descriptive statistics? |
Descriptive statistics consists of summarized data that can be displayed in tables or charts (e.g. GDP growth, inflation rate, unemployment). |
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What is inferential statistics? |
Inferential statistics is used to make predictions, forecasts, and estimates (e.g. What will GDP growth be next quarter?). |
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What is regression analysis? |
Regression analysis is the primary data tool that economists use. It measures the relationship between 2 or more variables (e.g. price and quantity). |
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What is the difference between positive and negative correlations? |
- When 2 variables tend to move in the same direction together, they are positively correlated. - When 2 variables move in opposite directions, they are negatively correlated. |
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How is an inference made? (7 steps) |
1) Come up with a question 2) Determine the population associated with your question 3) Select a sample from your population 4) Measure one or more variables for each unit in the sample 5) Your measurements for the variables are your data 6) Compute statistics using your data 7) Make an inference about the population from the sample statistics |
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What are parameters and statistics? |
- A parameter is a numerical measure describing a population - A statistic is a measure describing a sample |
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Difference between an arithmetic mean and a geometric mean |
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How do we calculate the position of the median once the measurements have been ordered (formula)? |
position of the median = 0.5 (n+1) |
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What is a mode? |
The mode is the measurement which occurs most frequently |
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What is a measure of variability? |
A measure along the horizontal axis of the data distribution that describes the spread of the distribution from the center. |
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Based on the empirical rule, what do we expect about 68%, 95%, and 99.7% of data to do..? |
Empirical rule: If a distribution is bell-shaped, we expect: - 68% of data to be within 1 SD of the mean - 95% of data w/in 2 SD's of the mean - 99.7% of data w/in 3 SD's of the mean |
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What is simple random sampling? |
Simple random sampling is a method of sampling that allows each possible sample of size n an equal probability of being selected. |
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What is the Central Limit Theorem? |
If random samples are drawn from a non-normal population with finite mu and SD s, then when n is large, the sampling distribution is approximately normally distributed (In ENGLISH, the approximation becomes more accurate the larger a sample is). |
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What is the difference between deductive reasoning and inductive reasoning? |
Deductive reasoning: go from a hypothesis to a conclusion Inductive: goes from a set of observations to a reasonable hypothesis |
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What is hypothesis testing? |
Hypothesis testing: deciding the value of a parameter based on some preconceived idea (e.g. did the sample come from a population with a mean of 5?) |
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What is point estimation? |
In performing point estimation, a single number is calculated to estimate a parameter. |
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What is interval estimation/confidence interval? |
Two numbers are calculated to create an interval within which the parameter is expected to lie. It is constructed so that, with a chosen degree of confidence, the true unknown parameter will be captured inside the interval. |
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What is a margin of error? |
The margin of error provides a lower ad upper bound to the difference between x-bar (sample) and mu (population). It is calculated as: 1.96 * standard error of x-bar Standard error of x-bar: sigma of x-bar/sqrt of n |
