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Bachanta Mexican (BM) has collected data on price ($ per burrito) and quantity (of burritos) sold over the last ten years. The firm has also

Bachanta Mexican (BM) has collected data on price ($ per burrito) and quantity (of burritos) sold over the last ten years. The firm has also collected data on the price ($ per slice of pizza) charged by Luciano's Pizza (LP) and the percentage change of growth in consumer income. The data are as follows below in the table:

a. According to your results, are Pizza and Burrito substitutes or complements? Can you be 99% confident? Explain.

b. Is Burrito a normal or inferior good? Can you be 95% confident? Explain.

c. You wish to estimate the demand for Burrito Q = Ppp1 Pcc2. (Note that you are not including income in your multiplicative demand model.)

Provide the appropriate regression results.

Year

Quantity

Price

Price LP

Income Growth

1

33,500

4.40

4.09

-1

2

92,600

4.79

3.56

3

3

32,400

4.08

4.15

1

4

81,700

3.47

4.18

0

5

144,800

2.06

4.33

2

6

114,300

3.74

3.58

1

7

156,600

3.11

3.75

4

8

158,000

2.29

3.95

0

9

58,100

3.24

4.39

3

10

135,000

2.10

4.45

4

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