Suppose you are interested in estimating the effect that gasoline prices have on the decision to ride a bike,take a bus,take a train,or drive your own car to work in this case,your preferred estimator would be
A)OLS.
B)a logit model.
C)a multinomial logit model.
D)a probit model.

Question

Quizplus · Accepted Answer

A multinomial logit model would be the best choice for estimating the effect of gasoline prices on the decision to choose a mode of transportation among multiple options (bike, bus, train, or car). This model allows for the estimation of the probability of each alternative being chosen, given a set of explanatory variables, including gasoline prices. OLS would not be appropriate as the outcome variable is categorical. Logit and probit models could also be used, but multinomial logit is preferred in this case as it can handle more than two alternatives.

Suppose You Are Interested in Estimating the Effect That Gasoline