The data set CPS92 08 that contains an extended version of the dataset used in Table 3.1 of the text (see below) for the years 1992 and 2008. It contains data on full- time, full-year workers, age 25-34, with a high school diploma or B.A../B.S. as their highest degree. A detailed description is given in CPS92 08 Description, available on the website. Use these data to answer the following questions. (a) Compute the sample mean for average hourly earnings (AHE) in 1992 and in 2008. Construct a 95% confidence interval for the population means of AHE in 1992 and 2008 and the change between 1992 and 2008.

The data set CPS92 08 that contains an extended version of the dataset used in
Table 3.1 of the text (see below) for the years 1992 and 2008. It contains data on full-
time, full-year workers, age 25-34, with a high school diploma or B.A../B.S. as their
highest degree. A detailed description is given in CPS92 08 Description, available
on the website. Use these data to answer the following questions.
(a) Compute the sample mean for average hourly earnings (AHE) in 1992 and in 2008.
Construct a 95% confidence interval for the population means of AHE in 1992 and
2008 and the change between 1992 and 2008.
(b) In 2008, the value of the Consumer Price Index (CPI) was 215.2. In 1992, the
value of the CPI was 140.3. Repeat (a) but use AHE measured in real 2008
dollars ($2008); that is, adjust the 1992 data for the price inflation that occurred
between 1992 and 2008.
(c) If you were interested in the change in workers’ purchasing power from 1992 to
2008, would you use the results from (a) or from (b)? Explain.
(d) Use the 2008 data to construct a 95% confidence interval for the mean of AHE for
high school graduates. Construct a 95% confidence interval for the mean of AHE
for workers with a college degree. Construct a 95% interval for the difference
between the two means.
(e) Repeat (d) using the 1992 data expressed in $2008.
(f ) Did real (inflation-adjusted) wages of high school graduates increase from 1992 to
2008? Explain. Did real wages of college graduates increase? Did the gap
between earnings of college and high school graduates increase? Explain, using
appropriate estimates, confidence intervals, and test statistics.
(g) Table 3.1 presents information on the gender gap for college graduates. Prepare
a similar table for high school graduates using 1992 and 2008 data. Are there
any notable differences between the results for high school and college graduates?