Question

Consider a binary response variable y and two explanatory variables xy and x2. The following table contains the parameter estimates of the linear probability model (LPM) and the logit model, with the associated p-values shown in parentheses. Constant .40 -2.30 x1 x2 0.06 (0.03) 0.36 0.90 (0.03)(0.07) -0.03-0.10 (0.02) (0.01) a. At the 5% significance level, comment on the significance of the variables for both models. Logit gnificant 0 (Not significant x1 x2 b. What is the predicted probability implied by the linear probability model forx 6 with x2 equal to 17 and 29? (Round intermediate calculations to at least 4 decimal places and final answers to 2 decimal places.) xi " 6, x2 “ 17 1 -6, x2 29 c. What is the predicted probability implied by the logit model for x1 6 with x2 equal to 17 and 29? (Round intermediate calculations to at least 4 decimal places and final answers to 2 decimal places.) x16, x2 17 1 -6,x2 29

Answer 1

Given Lim ab -2-30 03 0-96 36 Co o3) -0 03 Lo 02) s sgnih cana Level Vaiiable LPM Logit autf b Pudicied prktb bli b linean pebab lily m mode :は ラ-o.uo + Q. 16-osl I-as The

The predidel probability -br lc) pedtkd pobablily by loit mde 1t e lr e -2 30) (5 )

2 -2 30+S ) 1+C 0-9 8219 1t 1 aaly 1221り 05498S The predicted probablikl ter,s 6,0 29