PART I BASIC PROBABILITY AND STATISTICS 

1  (186) 


3  (22) 

Random Sampling: A Political Poll 


4  (6) 

Randomized Experiments: Testing a Hospital Routine 


10  (4) 

Observational Studies vs. Randomized Experiments 


14  (6) 

Brief Outline of the Book 


20  (5) 


20  (5) 


25  (44) 

Frequency Tables and Graphs 


26  (6) 


32  (7) 


39  (7) 


46  (1) 


47  (5) 

Calculations Using Relative Frequencies 


52  (1) 

The Use and Misuse of Graphs 


53  (16) 


64  (5) 


69  (40) 


70  (3) 


73  (6) 


79  (6) 


85  (4) 


89  (4) 

Bayes Theorem: Tree Reversal 


93  (6) 

Other Views of Probability 


99  (10) 


103  (6) 

Probability Distributions 


109  (44) 

Discrete Random Variables 


110  (3) 


113  (3) 

The Binomial Distribution 


116  (8) 


124  (3) 


127  (7) 

A Function of a Random Variable 


134  (7) 

Expected Value in Bidding 


141  (12) 


146  (7) 


153  (34) 


154  (7) 

A Function of Two Random Variables 


161  (3) 


164  (6) 

Linear Combination of Two Random Variables 


170  (17) 


176  (6) 

Review Problems (Chapters 15) 


182  (5) 
PART II INFERENCE FOR MEANS AND PROPORTIONS 

187  (168) 


189  (42) 


190  (6) 

Moments of the Sample Mean 


196  (3) 

The Shape of the Sampling Distribution 


199  (8) 

Proportions (Percentages) 


207  (8) 

SmallPopulation Sampling 


215  (3) 


218  (13) 


225  (6) 


231  (22) 


232  (1) 

Efficiency of Unbiased Estimators 


232  (7) 

Efficiency of Biased and Unbiased Estimators 


239  (5) 


244  (9) 


248  (5) 


253  (34) 


254  (7) 


261  (4) 

Difference in Two Means, Independent Samples 


265  (3) 

Difference in Two Means, Matched Samples 


268  (5) 


273  (4) 


277  (10) 


281  (6) 


287  (37) 

Hypothesis Testing Using Confidence Intervals 


288  (5) 


293  (7) 

Classical Hypothesis Tests 


300  (6) 

Classical Tests Reconsidered 


306  (4) 

Operating Characteristics Curve (OCC) 


310  (4) 


314  (10) 


320  (4) 

Analysis of Variance (ANOVA) 


324  (31) 


325  (11) 


336  (7) 


343  (12) 


346  (4) 

Review Problems (Chapters 610) 


350  (5) 
PART III REGRESSION: RELATING TWO OR MORE VARIABLES 

355  (160) 


357  (14) 


358  (2) 

Ordinary Least Squares (OLS) 


360  (6) 

Advantages of OLS and WLS 


366  (5) 


368  (3) 


371  (25) 


372  (3) 


375  (4) 

Confidence Intervals and Tests for β 


379  (4) 

Predicting Y at a Given level of X 


383  (6) 


389  (7) 


390  (6) 


396  (38) 


397  (3) 

The Regression Model and Its OLS Fit 


400  (6) 

Confidence Intervals and Statistical Tests 


406  (4) 

Regression Coefficients as Multiplication Factors 


410  (7) 

Simple and Multiple Regression Compared 


417  (7) 


424  (10) 


428  (6) 


434  (40) 


435  (10) 

Analysis of Variance (ANOVA) by Regression 


445  (4) 

Simplest Nonlinear Regression 


449  (3) 

Nonlinearity Removed by Logs 


452  (9) 

Diagnosis by Residual Plots 


461  (13) 


466  (8) 


474  (41) 


475  (7) 

Correlation and Regression 


482  (7) 


489  (7) 

Correlation in Multiple Regression 


496  (5) 


501  (14) 


506  (6) 

Review Problems (Chapters 1115) 


512  (3) 
PART IV TOPICS IN CLASSICAL AND BAYESIAN INFERENCE 

515  (122) 

Nonparametric and Robust Statistics (Requires Chapter 9) 


517  (32) 

Introduction: Mean or Median? 


518  (1) 


518  (4) 

Confidence Interval for the Median 


522  (3) 


525  (3) 


528  (5) 

Runs Test for Independence 


533  (3) 

Robust Statistics: Trimming and Weighting 


536  (13) 


545  (4) 

ChiSquare Tests (Requires Chapter 9) 


549  (15) 

X2 Tests for Multinomials: Goodness of Fit 


550  (5) 

X2 Tests for Independence: Contingency Tables 


555  (9) 


561  (3) 

Maximum Likelihood Estimation (Requires Chapter 7) 


564  (18) 


565  (1) 

MLE for Some Familiar Cases 


566  (7) 

MLE for the Uniform Distribution 


573  (3) 


576  (6) 


579  (3) 

Bayesian Inference (Requires Chapter 8) 


582  (38) 


583  (5) 

The Population Proportion 


588  (10) 

The Mean μ in a Normal Model 


598  (7) 

The Slope β in Normal Regression 


605  (3) 

Bayesian Shrinkage Estimates 


608  (7) 

Classical and Bayesian Estimates Compared 


615  (5) 


615  (5) 

Bayesian Decision Theory (Requires Chapter 19) 


620  (17) 

Maximizing Gain (or Minimizing Loss) 


621  (6) 

Point Estimation as a Decision 


627  (6) 

Classical and Bayesian Statistics Compared 


633  (4) 


635  (2) 
PART V SPECIAL TOPICS FOR BUSINESS AND ECONOMICS 

637  (100) 

Decision Trees (Requires Chapter 3) 


639  (25) 


640  (8) 

Testing to Revise Probabilities: Bayes Theorem 


648  (5) 

Utility Theory to Handle Risk Aversion 


653  (11) 


657  (7) 

Index Numbers (Requires Nothing Previous) 


664  (14) 


665  (3) 


668  (4) 


672  (6) 


675  (3) 

Sampling Designs (Requires Chapter 8) 


678  (14) 


679  (8) 


687  (5) 


690  (2) 

Time Series (Requires Chapter 15) 


692  (30) 

Two Special Characteristics of a Time Series 


693  (2) 

Decomposition and Forecasting Using Regression 


695  (10) 

Traditional Ratio to Moving Average 


705  (5) 

Forecasting Using Exponential Smoothing 


710  (2) 

Forecasting Using BoxJenkins Models 


712  (2) 

Generalized Least Squares (GLS) 


714  (8) 


719  (3) 

Simultaneous Equations (Requires Chapter 13) 


722  (15) 

Introduction: The Bias in OLS 


723  (4) 

The Remedy: Instrumental Variables (IV) 


727  (4) 

TwoStage Least Squares (2SLS) 


731  (6) 


735  (2) 
Appendixes 

737  (29) 

22 Careful Approximation of the Median 


738  (1) 

25 Effects of a Linear Transformation: Proofs 


738  (1) 

37 Probability as Axiomatic Mathematics 


738  (1) 

42 Easier Formula for σ2: Proof 


739  (1) 

43 Binomial Formula: Proof 


739  (2) 

44 Calculus for Continuous Distributions 


741  (1) 

53 Independent Implies Uncorrelated: Proof 


742  (1) 

54 Linear Combinations: Proofs 


742  (1) 

63 Central Limit Theorem 


743  (1) 

64 Continuity Correction: Graphical Explanation 


743  (1) 


743  (1) 

74 Consistency: Careful Definition 


744  (1) 

83 Standard Error of (X1X2): Proof 


745  (1) 

85 Confidence Interval for π: Derivation of Graph 


745  (1) 

92 A More Exact pValue for Proportions 


746  (1) 

101 Breakdown of Total SS: Proof 


747  (1) 

102 TwoWay ANOVA, Breakdown of Total SS: Proof 


747  (1) 

103 ANOVA Is Much More Than Just Testing H0 


748  (1) 


748  (2) 

112 LeastSquares Formulas: Proofs 


750  (1) 

122 The Moments of b: Proofs and Discussion 


751  (2) 

123 A Onesided or Twosided Test? 


753  (1) 

124 Confidence Intervals above X0: Proofs 


754  (1) 

132 Solution of a Set of Simultaneous Equations 


755  (1) 

135 Direct Plus Indirect Relation: Proof 


756  (1) 

144 Log Regression Handles a Multiplicative Error Term 


756  (1) 

151 Correlation in Chapter 15 Agrees with Chapter 5 


757  (1) 

152 ANOVA and r2: Proofs 


757  (1) 

182 MLE for Some Familiar Cases: Proofs 


758  (2) 

192 Bayesian Confidence Interval for π: Proof 


760  (1) 

193 Posterior Distribution of μ in a Normal Model: Proof 


761  (1) 

194 Posterior Distribution of β in Normal Regression: Proof 


761  (1) 

195 Bayesian Shrinkage Confidence Intervals 


762  (1) 

242 Serial Correlation and the DurbinWatson Test 


762  (1) 

243 Moving Averages in General 


763  (1) 

244 Exponential Smoothing: Proof 


764  (1) 

245 Forecasting Using BoxJenkins Models 


764  (2) 
Tables 

766  (15) 
References 

781  (6) 
Answers to OddNumbered Problems 

787  (16) 
Glossary of Common Symbols 

803  (4) 
Index of Examples and Problems 

807  (2) 
Index 

809  