The accompanying table shows a portion of the monthly data on the personal savings rate (Savings) and

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The accompanying table shows a portion of the monthly data on the personal savings rate (Savings) and personal disposable income (Income) in the U.S. from January 2007 to November 2010.

The accompanying table shows a portion of the monthly data

a. Compare the linear model, Savings = β0 + β1 Income + ε, with a log-log model, ln (Savings) = β0 + β1 ln (Income) + ε.
b. Interpret the estimated slope coefficient of both models.
c. Which is the preferred model? Explain.

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