If demand is estimated using the empirical specification $\ln Q = \ln a + b \ln P + c \ln M + d \ln P _ { R }$ , then an equivalent expression for demand is
A) $\ln Q = a + b P + c M + d P _ { R }$ .
B) $Q = a + b P + c M + d P _ { R }$ .
C) $Q = e ^ { a } + b P + c M + d P _ { R }$ .
D) $Q = a b P c M d P _ { R }$ .
E) none of the above

Question

Quizplus · Accepted Answer

The correct transformation of the given log-linear demand function is $Q = a P^b M^c P_R^d$, which is not listed among the options.

If Demand Is Estimated Using the Empirical Specification ln⁡Q=ln⁡a+bln⁡P+cln⁡M+dln⁡PR\ln Q = \ln a + b \ln P + c \ln M + d \ln P _ { R }lnQ=lna+blnP+clnM+dlnPR​

If Demand Is Estimated Using the Empirical Specification $\ln Q = \ln a + b \ln P + c \ln M + d \ln P _ { R }$