Scenario 4.5:
The demand curve for grilled cheese sandwiches has been estimated using statistical techniques as follows:
log(Q) = -1.10 - 0.18 log(P) + 1.21 log(I) + 0.84 log(Ph)
where Q is the quantity of grilled cheese sandwiches
P is the price of grilled cheese sandwiches
I is income
Ph is the price of hamburgers
-Scenario 4.5 indicates that grilled cheese sandwiches and hamburgers are:

Question

Quizplus · Accepted Answer

The positive coefficient on the price of hamburgers variable (Ph) indicates that an increase in the price of hamburgers leads to an increase in the demand for grilled cheese sandwiches. This suggests that the two goods are substitutes.

Scenario 4.5: The Demand Curve for Grilled Cheese Sandwiches Has Been Estimated