1. Suppose that we estimate the following gravity regression in which (log) exports from country i to country j (In(Xij)) are a function of (log) GDP in country i (In(GDP;)), (log) GDP in country j (In(GDP;)), the (log) distance between countries i and j in km (In(distij)), and an independently and identically distributed (i.i.d.) error term eij: In Xij = 2.50 + 1.5 In(GDP;) + 1.21n(GDP;) - 2In(distij) + eij Suppose that countries i and i' are identical in terms of GDP but i' is three times as far from /to j as is i. By what proportion will i's exports to j be larger / smaller than those of ?' (i.e. calculate the ratio Xij/Xi;)? A 1/9 B 1/3 C 9 D 3 E1