Economics Help!

posted by .

4) The manager of Collins Import Autos
believes that the number of cars
sold in a day (Q) depends on two
factor: (1) the number of hours the
dealership is open (H) and (2) the
number of salespersons working that
day (S). After collecting the data
for two months (53 days), the
manager estimates the following log-
linear model:
b c
Q = aH S

a) Explain how to transform this log-
linear model into a linear form
that can be estimated using
multiple regression analysis.

The computer output for the multiple regression analysis is shown below:
Dependant Variable: LNQ
R-Square: 0.5452 F-Ratio: 29.97
P-Value on F: 0.0001
Observations: 53
Variable: Intercept
Parameter Est: o.9162
Standard Error: 0.2413
T-Ratio: 3.80
P-Value: 0.0004
Variable: LNH
Parameter Estimate: 0.3517
Standard Error: 0.1021
T-Ratio: 3.44
P-Value: 0.0012
Variable: LNS
Parameter Est: 0.2550
Standard Error: 0.0785
T-Ratio: 3.25
P-Value: 0.0021
b) How do you interpret coefficients
b and c?If the dealership increases
the number of salespersons by 20
percent, what will the percentage
increase in daily sales?
c) Test the overall model for
statistical significance at the 5%
level?
d) What percent of the total variation
in daily auto sales is explained by
this equation?
What could you suggest to increase
this percentage?
e) Test the intercept for statistical
significance at the 5% level
Significance. If H and S both equal
0, are the sales expected to be 0?
Explain why or why not…..
f) Test the estimated coefficient b
for statistical significance. If
the Dealership decreases its hours
of operation by 10%, what is the
expected impact on daily sales?

Thanks,
EY


a) transform natural log values to linear values using e^x.
b) Parameter estimates in a log-linear function are elasticities.
c) what does the F statistic tell you?
d) what does the R^2 statistic tell you.
e) what does the T-ratio statistics on the parameter estimates tell you?
f) re-examine answers b and e

Respond to this Question

First Name
School Subject
Your Answer

Similar Questions

  1. 11th grade-Calculas

    The number of hours of daylight D depends upon the latitude and the day t of the year and is given by the equation : D(t)=12+Asin(((2pi)/(365))(t-80)) where A depends only on the latitude (and not t). for latitude 30 degress, A is …
  2. calculus

    The number of hours of daylight D depends upon the latitude and the day t of the year and is given by the equation : D(t)=12+Asin(((2pi)/(365))(t-80)) where A depends only on the latitude (and not t). for latitude 30 degress, A is …
  3. Algebra Word problem

    Suppose you are an event coordinator for a large performance theater. One of the hottest new Broadway musicals has started to tour, and your city is the first stop on the tour. You need to supply information about projected ticket …
  4. college

    Suppose that the number of cars, C, on 1st Avenue in a city over a period of time t, in months, is graphed on a rectangular coordinate system where time is on the horizontal axis. Further suppose that the number of cars driven on 1st …
  5. Math

    14. a. A Restaurant is open 24 hours a day. The manager wants to divide the day into work shifts of equal length. The shifts should not overlap, and all shift durations should be a whole number of hours. Describe the different ways …
  6. math

    a resturant is open 24 hours a day. T he manager wants to divide the day into work shifts of equal length. The shifts should not overlap. All shift durattions should be a whole number of hours. Describe the different ways this can …
  7. Math cars and SUVs

    The number of cars is larger than the number of sport utility vehicles by 94.7%. The difference between the number of cars and the number of suv is 18. Find the number of suv
  8. Math

    Suppose that the number of cars manufactured at an automobile plant varies jointly as the number of workers and the time they work. If 340 workers can produce 204 cars in 4 hours, find the number of workers that can produce 180 cars …
  9. math

    In one month a salesman sold a total of 30 cars and trucks. If three times the number of cars sold equals twice the number of trucks sold, how many trucks did he sell?
  10. Math

    Please Help! The number of cars sold weekly by a new automobile dealership grows according to a linear growth model. The first week the dealership sold five cars (P0=5 ). The second week the dealership sold cars (P1=12 Pn = Pn−1+7 …

More Similar Questions