Question 2 The following demand equation was estimated of mineral water consumption (n = 60): InQ=1.5-0.75 In P+0.25 In P R²=0.68 where Q: mineral water sold in million liters in area i P price of mineral water per liter (in ringgit) in area i P*: average price of carbonated soda beverage per can (in ringgit) in area i. a. Interpret the slope coefficients of the estimated model. b. Interpret the R² value. c. Is the sign of the estimated coefficient of Pi* consistent with your theoretical expectation? Explain.

Question 2 The following demand equation was estimated of mineral water consumption (n = 60): InQ=1.5-0.75 In P+0.25 In P R²=0.68 where Q: mineral water sold in million liters in area i P price of mineral water per liter (in ringgit) in area i P: average price of carbonated soda beverage per can (in ringgit) in area i. a. Interpret the slope coefficients of the estimated model. b. Interpret the R² value. c. Is the sign of the estimated coefficient of Pi consistent with your theoretical expectation? Explain.

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter1: Introducing The Economic Way Of Thinking

Section1.A: Applying Graphs To Economics

Problem 2SQP

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