TABLE 14-14
An econometrician is interested in evaluating the relation of demand for building materials to mortgage rates in Los Angeles and San Francisco. He believes that the appropriate model is

Y = 10 + 5X 1 + 8X 2
where X 1 = mortgage rate in %

X 2 = 1 if SF, 0 if LA
Y = demand in $100 per capita
-Referring to Table 14-14, the effect of living in San Francisco rather than Los Angeles is to increase the mean demand by an estimated ________.

Question

TABLE 14-14
An econometrician is interested in evaluating the relation of demand for building materials to mortgage rates in Los Angeles and San Francisco. He believes that the appropriate model is

Y = 10 + 5X 1 + 8X 2 
where X 1 = mortgage rate in %

X 2 = 1 if SF, 0 if LA
Y = demand in $100 per capita
-Referring to Table 14-14, the effect of living in San Francisco rather than Los Angeles is to increase the mean demand by an estimated ________.

Quizplus · Accepted Answer

The Answer of  TABLE 14-14
An econometrician is interested in evaluating the relation of demand for building materials to mortgage rates in Los Angeles and San Francisco. He believes that the appropriate model is

Y = 10 + 5X 1 + 8X 2 
where X 1 = mortgage rate in %

X 2 = 1 if SF, 0 if LA
Y = demand in $100 per capita
-Referring to Table 14-14, the effect of living in San Francisco rather than Los Angeles is to increase the mean demand by an estimated ________.

TABLE 14-14 An Econometrician Is Interested in Evaluating the Relation of Demand