QUESTION 6 You suspect that there could be some omitted variable in the regression. Therefore you decide to regress the log of the first-difference quantity of pack consumed onto a constant, the log of first-differenced real price, the log of first-differenced real income per capita (i.e. real income divided by population). What is the value of the coefficient associated with the price of cigarettes now? (round to the second decimal place) QUESTION 7 You suspect that even after first-differencing and including income, there could be some bias in the estimate of the effect of price on the quantity of cigarettes consumed. You therefore build an instrument for the price of cigarettes: the sales tax, equal to the difference between the overall tax ("taxs") and the cigarette specific tax ("tax"). You divide this new variable by the CPI to obtain real values, and then you take first differences. You run the same regression as in Question 6, but this time using Two-Stage Least Squares with the instrument you just created. What is the value of the coefficient associated with the price of cigarettes? (round to the second decimal place) QUESTION 8 As an alternative to the instrument of Question 7, you decide to instrument using the cigarette specific tax ("tax"). In order to do so, you divide by the CPI and then take first differences. If you run the instrumental variable regression of Question 7 with this new variable, what is the coefficient estimate associated with price? (round to the second decimal place)