Table 7-10 on the textbook's Web site contains data about the manufacturing sector of all 50 states and the District of Columbia. The dependent variable is output, measured as "value added" in thousands of U.S. dollars, and the independent variables are worker hours and capital expenditures.
a. Predict output using a standard linear model. What is the function?
b. Create a log-linear model using the data as well. What is this function?
c. Use the MWD test to decide which model is more appropriate.