In Section 5.7.4, we discovered that the optimal level of advertising for Big Andy's Burger Barn, (A

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In Section 5.7.4, we discovered that the optimal level of advertising for Big Andy's Burger Barn, \(A D V E R T_{0}\), satisfies the equation \(\beta_{3}+2 \beta_{4} A D V E R T_{0}=1\). Using a \(5 \%\) significance level, test whether each of the following levels of advertising could be optimal:

(a) \(A D V E R T_{0}=1.75\),

(b) \(A D V E R T_{0}=1.9\), and

(c) \(A D V E R T_{0}=2.3\). What are the \(p\)-values for each of the tests?

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Principles Of Econometrics

ISBN: 9781118452271

5th Edition

Authors: R Carter Hill, William E Griffiths, Guay C Lim

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