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Homework answers / question archive / The economist then runs a different specification (In Price on In size and other linear terms) for the hedonic regression of ?he car prices

The economist then runs a different specification (In Price on In size and other linear terms) for the hedonic regression of ?he car prices

Economics

The economist then runs a different specification (In Price on In size and other linear terms) for the hedonic regression of ?he car prices. The results are in Table two Table Two Log(price) Specification Three Variable Coefficient Standard Error t-statistic Constant 4.49 0.28 16.25 Ln(Size) -2.34 0.18 -13.22 Fuel 0.031 0.011 2.80 Weight 0.002 0.0001 22.99 Power 0.015 0.0007 20.70 Torque -0.005 0.0004 -12.62 R 0.8038 R2 0.8028 SSR 83.079 (a) Interpret the coefficient on In(Size). (b) Interpret the coefficient on fuel and Power. (c) Interpret the RP of the model. (d) Construct and interpret the 95% confidence interval for Tourque. (e) Test the hypothesis that as Power of the car increases by unit value of the car increases by $200.

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