Instruction 13-11
An econometrician is interested in evaluating the relation of demand for building materials to mortgage rates in Sydney and Melbourne.He believes that the appropriate model is
Y = 10 + 5X 1 + 8X 2
where X 1 = mortgage rate in %
X 2 = 1 if Sydney,0 if Melbourne
Y = demand in $100 per capita
-Referring to Instruction 13-11,holding constant the effect of city,each additional increase of 1% in the mortgage rate would lead to an estimated increase of ________ per capita in the mean demand.

Question

Instruction 13-11
An econometrician is interested in evaluating the relation of demand for building materials to mortgage rates in Sydney and Melbourne.He believes that the appropriate model is
Y = 10 + 5X 1 + 8X 2 
where X 1 = mortgage rate in %
X 2 = 1 if Sydney,0 if Melbourne
Y = demand in $100 per capita
-Referring to Instruction 13-11,holding constant the effect of city,each additional increase of 1% in the mortgage rate would lead to an estimated increase of ________ per capita in the mean demand.

Quizplus · Accepted Answer

The Answer of Instruction 13-11
An econometrician is interested in evaluating the relation of demand for building materials to mortgage rates in Sydney and Melbourne.He believes that the appropriate model is
Y = 10 + 5X 1 + 8X 2 
where X 1 = mortgage rate in %
X 2 = 1 if Sydney,0 if Melbourne
Y = demand in $100 per capita
-Referring to Instruction 13-11,holding constant the effect of city,each additional increase of 1% in the mortgage rate would lead to an estimated increase of ________ per capita in the mean demand.

Instruction 13-11 An Econometrician Is Interested in Evaluating the Relation of Demand