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Let us look at how to use R to answer substantive questions using statistical inference. In this section, we will focus on questions one could ask regarding one continuous outcome variable of interest. A continuous variable can take on an infinite number of possible values within an interval such as income. Economic growth will be the variable used as an example throughout this section.

Specifically, we will use statistical inferences to answer two substantive questions: What is the average economic growth rate in the world economy? Did the world economy grow faster in 1990 than in 1960? We will discuss in detail how to use statistical inference, sample data, and R to answer each of these two questions. The process learned here can be applied to similar questions about other continuous random variables of interest.

We will begin with a brief but important introduction to the logic of statistical inference and key concepts. We will then demonstrate how to get data ready for analysis in R. Next, for each research question, we will discuss statistical inference using two different methods: null hypothesis testing and confidence interval construction. We will emphasize both a coherent conceptual understanding of statistical inference and its implementation in R. Our objectives in this section are as follows:

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