Assignment 4. Due date Friday November 13

This question involves performing the analysis for Berndt Exercise 8, page 208. Use CPS85.jmp. Read the chapter. Understand the variables in the dataset by reading section 5.6. Make sure that before launching into the regressions you have a look at the raw data.

8a

Your gopher has found heteroscedasticity corrected standard errors using a bootstrap analysis; they are:

 
FE     UNION     NONWH     HISP     ED      EX      EXSQ
0.020  0.023     0.027     0.040    0.0081  0.0060  0.00013

8b

Don't do the square root transform. JMP-IN can do what is suggested in Note 2. Make sure that you use the INVERSE predicted/fitted variances as weights.

8c

The 5% chi-squared critical value on 27 degrees of freedom (used in White's procedure) is 40.12. Note: consistent with homescedasticiy if the test statistical is less than the critical value.