Which equation choose as better estimation for elasticities

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Assignment

Demand can be estimated with experimental data, time-series data, or cross-section data. In this case, cross-section data appear in the Excel file. Soft drink consumption in cans per capita per year is related to six-pack price, income per capita, and mean temperature across the 48 contiguous states in the United States.

QUESTIONS

1. Given the data, please construct the demand estimation for soft drink consumption in the United States by

(1) a multiple-linear regression equation (10%), and
(2) a log-linear (exponential) regression equation (10%).

2. Given the MS Excel output in Question 1, please compare the two regression equations' coefficient of determination (R-square), F-test and t-test. Which equation is a good (better) fit? Which equation shows the stronger overall significance to predict the future demand? Which equation will you choose as a better estimation for quantity demanded? Which equation will you choose as a better estimation for elasticities? Explain your answer in the language of statistics.

Attachment:- Case-Data.rar

Reference no: EM131897844

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