The dependent variable is oil price sensitivity. The independent variables are money supply exchange rate, oil subsidy and inflation rate. Answer: i. Form the hypothesis for each variables. (5 marks) ii. Explain whether the sign is in line with the theory. (5 marks) iii. Explain the hypothesis based on the t-values in the bracket. (5 marks) iv. Explain the R-square. (5 marks) Money Equation supply 1 2 3 45 2.06 (3.24) 3.45 (2.65) 3.65 (1.25) 4.56 (2.68) Exchange rate 4.65 (2.33) 3.45 (3.56) 2.33 (2.03) 3.33 (2.45) Oil subsidy 2.67 (3.45) 1.33 (2.34) Table 1 Inflation rate 4.33 (2.33) R square 0.38 0.35 0.66 0.56 0.78