ECON392 - Rate of Offenses Known to Police

ECON392 – Economics of Crime – Test # 1

Name __________________________________ Test Score________

Test # 1- Module # 1

(Show all your work!!! No Plagiarism! * 50 points)

Part A: Table and Graphical Analysis

Problem # 1: “Rate of Offenses Known to Police, United States, 1995 -2003” (selected Years - Rate per 100,000 inhabitants; 10 points)

Please read “Table 1-2 on page 8 (Hellman Textbook)

a). Fill in the blanks in the following table using Excel formulas. For example, the growth rate of violent crime (in percentage) from 1995 to 1996 is calculated as follows:

Violent Crime Growth Rate = Violent Crime 1996 – Violent Crime 1995

(-------------------------------------------------------)*100

Violent Crime 1995

Year Total Crime Index Violent Crime Property Crime

Murder & Manslaughter Forcible Rape Robbery Aggravated Assault Burglary Larceny Theft Motor Vehicle Theft

1995

1996

1997

1998

1999

2000

2001

2002

2003

Mean

b). Plot crimes growth rates over time (1995 – 2003).

Problem # 2: “Victimization Rates for Individuals, 1993 -2003” (selected Years; 10 points)

Please read “Table 1-4 on page 16 (Hellman Textbook).

a). Compute the “Percent Change” in victimization rates from 1993 to 2003 and fill in the blanks in the following table using Excel formulas:

Year Personal Crimes Violent Crimes Rape & Sexual Assault Robbery Assault Personal Theft Property Crimes

Household Burglary Motor Vehicle Theft Theft

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

b). Plot the above data (1993 – 2003).

Part B: Quantitative Analysis

Problem # 1: “Demand Analysis” (6 points)

Refer to Figures 2-1, 2-2, and 2-3 on pages 43-45 (Hellman Textbook). Assume that property insurance and security equipment are substitutes and the price of insurance decreases relative to that of security equipment.

a). Indicate whether a decrease in the price of insurance is an upward or downward movement along the demand curve of security equipment or instead involves an outward or inward shift in the demand curve of security equipment. Explain your answer.

b). Indicate whether a decrease in the price of insurance is an upward or downward movement along the demand curve of property insurance or instead involves an outward or inward shift in the demand curve of property insurance. Explain your answer.

Problem # 2 “Expected-Punishment Costs” (6 points)

Refer to Table 3-1 on page 57 (Hellman Textbook). Assume that the probability of arrest and the probability of conviction (given arrest) are 0.8 and 0.5, respectively. The expected sentence is 20 years.

a). Calculate the values of punishment of individual A and B.

b). Calculate the expected-punishment costs of individual A and B.

Part C: Summary and Comments

Please write double-spaced summary and comments (three paragraphs typed) on each of the following readings (Each paragraph must contain three sentences and is worth 3 points. Please use Times New Roman, one inch margins, and 12 point font):

Summary & Comments # 1 (9 points)

Read and summarize “Some Macroeconomic Explanations of Criminal Behavior” (pages 70-72) (Hellman Textbook).

Summary & Comments # 2 (9 points)

Read and summarize “Optimum Allocation within Courts and Corrections” (pages 103-109) (Hellman Textbook).