4. Regression in Practice Suppose you work for a food manufacturer who asks you to model the demand for chocolate. To help you get started, your employment has data on two variables: qdchocolate - per capita chocolate purchases and pchocolate - the price of chocolate in ounces. 6. If Halloween causes a large increase in chocolate purchases followed by a decline in chocolate purchases in November, would you be concerned about the shocks to chocolate demand in one month being related to shocks in another month resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 7. If the price of chocolate varies considerably from one state to another, would you be concerned about the price of chocolate resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 8. If the price of chocolate and the quantity demanded of chocolate are jointly determined as the result of an equilibrium outcome, are you concerned about the price of chocolate and the quantity demanded of chocolate resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 9. If the price of chocolate in ounces and the price of chocolate in pounds are directly related, pchocolateinounces=16pchocolateinpounds, would you be concerned about the two prices resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 10. Suppose you estimate a regression that includes the variables you chose in (4.) and the R-Square is 0.005. How do you interpret an R-Square of 0.005 ? 11. Suppose you estimate a regression that includes the variables you chose in (4.) and the R-Square is 0.005. Is an R-Square of 0.005good, bad, or are you unable to say? 4. Regression in Practice Suppose you work for a food manufacturer who asks you to model the demand for chocolate. To help you get started, your employment has data on two variables: qdchocolate - per capita chocolate purchases and pchocolate - the price of chocolate in ounces. 6. If Halloween causes a large increase in chocolate purchases followed by a decline in chocolate purchases in November, would you be concerned about the shocks to chocolate demand in one month being related to shocks in another month resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 7. If the price of chocolate varies considerably from one state to another, would you be concerned about the price of chocolate resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 8. If the price of chocolate and the quantity demanded of chocolate are jointly determined as the result of an equilibrium outcome, are you concerned about the price of chocolate and the quantity demanded of chocolate resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 9. If the price of chocolate in ounces and the price of chocolate in pounds are directly related, pchocolateinounces=16pchocolateinpounds, would you be concerned about the two prices resulting in endogeneity, heteroskedasticity, perfect multicollinearity, or serial correlation? 10. Suppose you estimate a regression that includes the variables you chose in (4.) and the R-Square is 0.005. How do you interpret an R-Square of 0.005 ? 11. Suppose you estimate a regression that includes the variables you chose in (4.) and the R-Square is 0.005. Is an R-Square of 0.005good, bad, or are you unable to say
