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In Ability, Gender, and Performance Standards: Evidence from Academic Probation, Jason M. Lindo, Nicholas J. Sanders, and Philip Oreopoulos find evidence using regression discontinuity methods that being placed on academic probation increases the probability that a student voluntarily leaves the university. Figure 1 below shows the estimated discontinuity in probation status at the end of the first year, and Figure 2 shows the impact of being placed on academic probation on the decision of male students to permanently leave the university at the end of their first year. Figure 1 Figure 2 1) Why doesn’t the mean difference between the rates of voluntary leaving for students placed on probation and those not placed on probation provide an unbiased estimate of the effect of being placed on probation? 2) Based on Figure 1, which type of RD do you think this study is using, sharp or fuzzy RD? Explain the difference between the two. 3) Briefly explain why the regression discontinuity estimates provide an unbiased estimate of the effect of being placed on probation? 4) In this study, GPA is used as a running variable. Describe the role of the running variable in a sharp regression discontinuity design.
Explain how are presidential election outcomes related to the performance of the economy. What are the major factors that have affected U.S. household consumption since the recession in 2001.
Consider a market where supply and demand are given by QXS = -10 + PX and QXd = 71 - 2PX. Suppose the government imposes a price floor of $33, and agrees to purchase any and all units consumers do not buy at the floor price of $33 per unit. Determine..
Illustrate what other additional information do you need, and how would you proceed if you had that information.
Suppose that twin eye doctors work across the hall from each other. Even their parents have trouble telling them apart, and they both went to the same medical school. From this information, we would guess that the price elasticity of demand for eithe..
Do you think that Business practices in an Islamic country are likely to differ from Business practices in the United States? If so, how? Recognize why many economics believe that unrestricted free trade between nations will raise the economic welfar..
What is the equilibrium output and price level? If aggregate demand shifts right, what is equilibrium output? If aggregate demand shifts left, what is equilibrium output?
Suppose that the demand curve for wheat is Q = 100 − 10p and the supply curve is Q = 10p. The government imposes a price ceiling of p = 3. Describe how the equilibrium changes. What effect does this price ceiling have on consumer surplus, producer su..
Political participation is the bedrock of representative democracy. What are some of the major forms of political participation afforded to US citizens? Compare and contrast (similarities and differences) the forms of participation and strategies use..
The management of a private hospital is considering the installation of an automatic telephone switchboard, which would replace a manual switchboard and eliminate the attendant operator’s position. how large an investment in the new equipment can be ..
Suppose In a Found Ltd. just issued a dividend of $1.52 per share on its common stock. The company paid dividends of $1.20, $1.26, $1.33, and $1.44 per share in the last four years. If the stock currently sells for $55, what is your best estimate of ..
In a perfectly competitive market, the inverse demand for a product is P(Q) = 200 − Q. Production is associated with a marginal private cost, MCP (Q) = Q, and a constant marginal external cost, MCE = 40. What is the unregulated equilibrium under perf..
Evaluate the results of the regression equation tells managers and how it is likely to impact decisions made related to maximizing profitability.
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