The aim of a logit model was to determine mobile phone ownership as a function of (logarithm of) income. Mobile phone ownership was a binary variable: Y = 1 if a household owns a mobile phone, zero otherwise.

Li = −2.77231 + 0.347582 ln(Income)

t = (−3.35)   (4.05)

χ 2 (1 df) = 16.681 (p value = 0.0000);

where; Li = estimated logit and where ln Income is the logarithm of income. The χ2 measures the

goodness of fit of the model.

Use the information from the regression output to answer the following questions.

Q.6.1 Interpret the estimated logit model. (2)

Q.6.2 From the estimated logit model, derive the expression for the probability of mobile phone

ownership? (7)