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Answer:-

Given That:-

Using the data in SLEEP75 we, obtain the estimated equation.

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(i) All other factors being equal, is there evidence that men sleep more than women? How strong is the
evidence?

To identify whether male sleeps more than women per week, check the coefficient of dummy variable
male. The coefficient esimate of male is given to be 87.75, indicating that a male sleeps almost one and half
hour more than a female per week.

To verify the strength of coefficient estimate apply the t-test. Under null hypothesis, it is assumed that the
coefficient is not satistically signi cant (or equal to zero), against alternative hypothesis, that it is statistically
signi cant.

Under hypothesis,

Where, is the mean value (or coefficient)

Under t-test,

= 2.56

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This is close to the 1% critical value against a two-sided alternative (about 2.58). Thus rejecting null
  hypothesis, and acceptingTextbook
women per week.
alternative Solutions
hypothesis. InExpert
other words,
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that men sleep more than
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(ii) Is there a statistically signi cant tradeoff between working and sleeping? What is the estimated
tradeoff?

To test whether there is any signi cant trade-off between sleep and work, apply t-test of signi cance.

Under null hypothesis, it is assumed that the coefficient estimate is not statistically signi cant (or equal to
zero), against alternative hypothesis, that it is statistically signi cant.

Under hypothesis,

Where, is the mean value (or coefficient)

Under t-test,

= -9.06

This is statistically signi cant. Thus, rejecting null hypotesis, and accepting alternative hypothesis. The
coefficient indicates that one more hours of work (or 60 minutes of work) is associated with 0.163 60 =
9.8 minutes less sleep.

(iii) What other regression do you need to run to test the null hypothesis that, holding other factors xed,
age has no effect on sleeping?

The way to test the null hypothesis is to rst calculate the R-square from restricted regression equation and
R-square from unrestricted regression, then compare the signi cance using F-statistic.

The restricted regression equation will have all the variables in the model, except age and age2, and the
unrestricted model will be same as mentioned in the question. When age and age2 are in the model, age
will be statistically insigni cant or will have no effect, only if the parameters on both terms are zero.

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