Determinants of price per ounce of cola. Cathy Schaefer, a student of mine, estimated the following regression
Question:
Pi = β0 + β1D1i + β2D2i + β3D3i + μi
Where
Pi = price per ounce of cola
D1i = 001 if discount store
= 010 if chain store
= 100 if convenience store
D2i = 10 if branded good
= 01 if unbranded good
D3i = 0001 if 67.6 ounce (2 liter) bottle
= 0010 if 28€“33.8 ounce bottles (33.8 oz = 1 liter)
= 0100 if 16-ounce bottle
= 1000 if 12-ounce can
The results were as follows:
The standard errors are shown only to five decimal places.
a. Comment on the way the dummies have been introduced in the model.
b. Assuming the dummy setup is acceptable, how would you interpret the results?
c. The coefficient of D3 is positive and statistically significant. How do you rationalize this result?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
a This assignment of the dummy variables assumes a constant p...View the full answer
Answered By
Shadrack Mulunga
I am a Biochemistry by profession. However, I have explored different fields of study. My quest to explore new fields has helped me gain new knowledge and skills in Business, clinical psychology, sociology, organizational behavior and general management, and Project Management. I count my expertise in Project management, in particular, creation of Work Break Down Structure (WBS) and use of Microsoft Project software as one of my greatest achievement in Freelancing industry. I have helped thousands of BSC and MSC students to complete their projects on time and cost-effectively using the MS Project tool. Generally, I find happiness in translating my knowledge and expertise to success of my clients. So far, i have helped thousands of students to not only complete their projects in time but also receive high grades in their respective courses. Quality and timely delivery are the two key aspects that define my work. All those who hired my services always come back for my service. If you hire my services today, you will surely return for more. Try me today!
154+ Reviews
289+ Question Solved
Related Book For 
Question Posted:
