8.4 Given the following data for 1989 and 1990: Year Price of margarine Price of butter Real income 1989 79.3 104.3 120.2 1990 79.3 97.0 122.7

(a) Predict the levels of margarine consumption in the two years.

(b) The actual values of consumption for the two years were 3.47 and 3.19. How accurate are your forecasts?

(c) Test for the stability of the coefficients between sample and forecast periods. 8.5 How would you most appropriately measure the following variables:

(a) social class in a model of alcohol consumption;

(b) crime;

(c) central bank independence from political interference.