Question

  

Education X (Last completed School)	Sex Z 0 (male)                  1 (female)
None 0	4,000,000                 5,000,000
Primary 1	10,000,000               12,000,000
Secondary 2	23,000,000.               29,000,000
College 3	10,000,000.                7,000,000

Wonnacott and Wonnacott (5the Edition) Pg. 178 problem (5-22) Can some one help me solve the problem below? The Table is already on Chegg. Continuing Problem 5-20, suppose (contrary to fact, fortunately) that each American drew a salary S that depended only upon education and sex as follows (annual salary in $000): S = 10 + 2X + 4Z (that is, a basic 10 thousand, plus bonuses for education and sex).

a. What would the salary be for each of the 8 combinations (cells) in the given table? To reorganize your answer, list the possible salaries in order, and tabulate the corresponding probabilities (the distribution of salary).

b. From the distribution of salary, calculate the expected salary E(S).

c. Since S = 10 + 2X + 42, try calculating its expected value alternatively as: E(S) = 10 + 2E(X) + 4E(Z)

d. Why does your answer to c agree with b? (Is it a fluke, or is it because S is a special function?)

Answer 1

The answers to part b and c do not match