Yom Postgraduate College

Masters of Science Program

Department of Project Planning and Management
Final Exam of Research Method
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Lecturer: Zerayehu Sime (PhD in Economics) HIWOT MATHEWOS
Section: 1 RM_ASSIGNMENT_ GSEH.293/2015

A) Individual Assignment

Important Instruction:

a) Read the instructions carefully.

b) Answer all questions legibly and neatly specific to the questions you are asked.
c) You should put your answer for each question in this document only after question.
Do not prepare another answer sheet.
d) Submit all assignments together in one file at the final exam date. If you send me in
a separate file, I will take only the first one only.
e) Submit via this email account only: zseh2020@gmail.com. If you send me with other
and different email account, I will not accept it
f) Your file name should be: RM_ASSIGNMENTS_Your ID.
g) Subject in the email should be: RM_ASSIGNMENTS_Your ID
Example: RM_Assignment_GSR.0034/2015
h) Do not forget your name and ID number in all sheets
i) If you failed to fulfil one of the instructions above, I will not mark it at all.
j) If you failed to meet the deadline set by the department, you will be penalized
k) Do not copy and paste from other documents and internet.
l) Do not copy from your colleague. If you do, both of you will be penalized at the
same rate
m) Be specific and write to the point. Do not write irrelevant information
Lecturer: Zerayehu Sime (PhD in Economics) HIWOT MATHEWOS
Section: 1 RM_ASSIGNMENT_ GSEH.293/2015

Instruction: Read carefully the following statements and answer the following questions

There are erratic and poor performances of firms’ growth in Addis Ababa. Export intensity in the
manufacturing firms has been growing at scanty rate, ranging from 2 percent in 2000 to 2.7 percent in
2017. This poor performance varies across firms. Metal manufacturing firms grow at 0.5 percent on
average in the study period while those who are engaged in the production of processed coffee shows only
1.5 percent on average. The problem is not only limited to poor performance, rather it is highly erratic,
evidencing that growth moves negative over the period 2000- 2004 and 2011-2014, on the other years there
was positive growth. The problem is not confined into export side, rather it has been extended into the live
and death of the manufacturing firms by adversely affecting profit to the extent of 3 percent and declining
the capital structure of the firms by 2 percent. In the long run, it negatively influences the foreign currency
position and growth of the country, affecting the futurity of the nation. Bekele (2005) and Geber (2010)
have done research paper on related issues and found that only internal factors are the statistically
significant factors that influences firm’s growth. However, Challa (2004) and Zebibdar (2013) found that
availability of foreign currency and political interference are the most important in explaining the firms’
growth. In summary, there is inconsistency in terms of the findings they have. And, there are other factors
that could be the most considerable factors based on the lesson we draw from other countries namely
Kenya, South Africa and Ghana (Stephen, 2015). Therefore, this paper will consider all dimensions of firm’s
performance including ownership specific characters, firms’ character, industry characters and institutional
factors and use advanced methods.

Therefore, the overriding objective of the paper is to examine the determinants of the growth of export
intensity of the manufacturing firms in Addis Ababa with specific objective of assessing the export
performance and figure export intensity for manufacturing firms and examining the major determinants
(ownership character, firms’ character, industry character and institutional factor) of export intensity of
manufacturing firms in Addis Ababa. The paper will also employ Yamane (1967):

It also applies a stratified Sampling based on ten types of manufacturing firms and then apply random
sampling based on Primary data using interview, questionnaire, panel discussion, and observational
checklist and also use secondary data:

Export Intensity=f (ownership character, firms’ character, industry character, intuitional character)
 Lecturer: Zerayehu Sime (PhD in Economics) HIWOT MATHEWOS
Section: 1 RM_ASSIGNMENT_ GSEH.293/2015

Questions 1: Answer the following questions based on the above short proposal.
1. What could be the possible title of the research?

Increasing Export intensity of manufacturing firms in Addis Ababa

2. What are the limitations associated with the problem statement?
 It is not SMART(specific ,measurable, attainable, reliable ,time bounded)
 inconsistency in terms of the findings

3. What are your comments with the objectives?

 The objective is good because it shows the growth of export intensity of the manufacturing firms in
Addis Ababa and the export performance to figure export intensity for manufacturing firms it is
the way to get solution to increase intensity of export

4. What is the unit of analysis applied in the paper?

Export intensity of manufacturing firms in Addis Ababa፡

5. What is the size of population? What sampling technique the paper will use?

The size of population mentioned in the paper is 2500 and the sampling technique it used is stratified
Sampling (based on ten types of manufacturing firms) and random sampling(based on Primary data using
interview, questionnaire, panel discussion, and observational checklist and also it used secondary data:

6. What are your comments on the model specifications and estimation method?

It must be Specified based on conceptual framework and it is not in the function form: Linear or
Nonlinear
Lecturer: Zerayehu Sime (PhD in Economics) HIWOT MATHEWOS
Section: 1 RM_ASSIGNMENT_ GSEH.293/2015

Question 2: Assuming that a project manager is interested in looking in scaling up the efficiency of the project
with the determinants: Price, project capital, income of the employees, and corruption in order to identify the
driving forces of competitiveness. Given 39 years data you are given, answer the following questions. Note that
TSS=1,233,636.00; ESS=1,097,519.00 and Probability >F = 0.006

Efficiency Coefficient Std. Err. [95% Confidence Interval]

Income 5.639438 1.801161 1.979038 9.299838
Price -0.141801 0.3118394 -0.775535 0.4919329
Project Capital 6.238192 2.773586 0.6015868 11.8748
Corruption index 3.148463 1.22406 -17.62932 23.92624
Constant -20.71968 89.03593 -201.6624 160.2231
a) Compute the Coefficient of determination and interpret it at 5% level of significance.

Income and efficiency have direct relationship i.e. when income increase the efficiency also
increase .Price and efficiency have indirect relationship i.e. when price increase efficiency decrease. Project
capital and efficiency also have direct relationship i.e. when Project capita increase the efficiency also increase.
The last one is corruption index it have direct relationship i.e. when corruption index increase the efficiency
also increase but it is insignificant. Finally Income and project capital are significant and influence the output
because of Pvalue <0.05 e.i we have Pvalue=0.006<margin of error (5%) so that it is significant. But price and
corruption index have negative impact on efficiency so they are insignificant and have no influence to output.

b) Is the Model good to fit with data?

Yes it is a Good model b/c Pvalue<0.05(margin of error)or prob>F=0.006<α

c) Which explanatory variables are policy variables in order to scale up the efficiency of a given project
in market at 5% level of significance?

Income and project capital are policy variables b/c prob>F=0.006<α c Pvalue<0.05(margin of
error)and they are significant and also in 95% confidence interval there is no zero

d) It is strongly recommended to conduct the post-estimation tests before a researcher presents here/his
regression results. Therefore, the STATA accordingly gives us the following post estimation tests for
the model presented in equation 1. (10 Points)

Post Estimation Tests Chi2 test P-value >/Chi2/

Normality 21.3 0.0188
Autocorrelation 2.10 0.1543
Heteroskedasticity 1.24 0.2647
Lecturer: Zerayehu Sime (PhD in Economics) HIWOT MATHEWOS

Section: 1 RM_ASSIGNMENT_ GSEH.293/2015

1) Write down the hypothesis testing for each post-estimation test shown above

-For normality test If p-value>/chi2/=0.0188 is greater than 0.05(margin of error) it is statically

insignificant there for we accept Ho so that there is no problem on normality test
-For Autocorrelation pot estimation tests p-value>/chi2/=0.1543 is b/n 0 to 1 so that its level of
correlation is very weak positive

2) What problem do you observe? If there is, what solution do you recommend?

On the autocorrelation test it is very week relationships it is not good it make our final result negative or no
solution

Question 3: In statistics, the logistic model (or logit model) is a statistical model that models the
probability of an event taking place by having the log-odds for the event be a linear combination of
one or more independent variables. These data were collected on 200 high schools’ students and
are scores on various tests, including science, math, reading and social studies (socst). The variable
female is a dichotomous variable coded 1 if the student was female and 0 if male.

Logit estimates Number of obs = 200

LR chi2(3) = 71.05
Prob > chi2 = 0.0000
Log likelihood = -80.11818 Pseudo R2 = 0.3072

------------------------------------------------------------------------------
honcomp | Coef. Std. Err. z P>|z| [95% Conf. Interval]
-------------+----------------------------------------------------------------
female | 1.482498 .4473993 3.31 0.001 .6056111 2.359384
read | .1035361 .0257662 4.02 0.000 .0530354 .1540369
science | .0947902 .0304537 3.11 0.002 .035102 .1544784
_cons | -12.7772 1.97586 -6.47 0.000 -16.64982 -8.904589
------------------------------------------------------------------------------
a) Is this model good to fit with data?
Yes it is good model b/c prob>chi2=0.00 is less than 5%(margin of error)
b) What are statistically significant variables?
Female, read and science are statistically significant variables b/c All P>Z values are
<0.05(margine of error) and 95% confi.interval have no zero b/n them.
c) How do you interpret the coefficient of female?

When the number of female increase the honcomp also increase by 1.482 they have positive
relationship and it influence the output

d) What makes different the logit model with linear model? Please see the link below for all kinds of
interpretation.

Legit model uses categorical variables

- It uses prob> chi2 value
Lecturer: Zerayehu Sime (PhD in Economics) HIWOT MATHEWOS

Section: 1 RM_ASSIGNMENT_ GSEH.293/2015

Linear model Use continuous variables

- prob>F value
- is interpreted or we can interpret it

https://stats.oarc.ucla.edu/other/annotatedoutput/