Find t-calculated values for the respective coefficients

Reference no: EM13182359

Interpret the following regression equation together with all the supporting statistics where Yt is the number of new cars sold (millions of units), X1t is the disposable income of consumers ($B), X2t is the price of a new car (an index number where 1982-84=100), and X3t is the 5-year Treasury Bond rate (%). The values reported in parenthesis directly below the regression coefficients are the t-calculated values for the respective coefficients.

Fcal = 25.98

R2 = .58

Yt=.002 + .005X1t - .025X2t - .125X3t n=28 (1956-84)

(4.12) (5.23) (-1.51) (-2.65)

Assume that the model was re-estimated in its double logarithmic form and the results read:

Fcal = 30.28

R2 = .62

lnYt=.002 + 1.4 5lnX1t - .75lnX2t - 1.10lnX3t n=28

(3.12) (4.33) (-2.21) (-1.65)

Interpret this model and relate to the concept of elasticity. Write the model in its exponential format with the relevant coefficients.

Reference no: EM13182359

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