(a) Reconsider the model SAL1 b1 b2PR1 b3PR2 b4PR3 e from Exercise 5.16. Estimate this model if you have not

(a) Reconsider the model SAL1 ¼ b1 þ b2PR1 þ b3PR2 þ b4PR3 þ e from Exercise 5.16. Estimate this model if you have not already done so, and find a 95%

interval estimate for expected sales when PR1 ¼ 90; PR2 ¼ 75, and PR3 ¼ 75.

What is wrong with this interval?

(b) Estimatethe alternative modellnðSAL1Þ ¼ a1 þ a2PR1 þ a3PR2 þ a4PR3 þ e, and find a 95% interval estimate for expected log of sales when PR1 ¼ 90; PR2 ¼ 75, and PR3 ¼ 75. Convert this interval into one for sales, and compare it with what you got in part (a).

(c) How does the interpretation of the coefficients in the model with ln(SAL1) as the dependent variable differ from that for the coefficients in the model with SAL1 as the dependent variable?