Question
CASE: DEMAND ESTIMATION and ELASTICITY: Soft Drinks in the U.SDemand can be estimated with experimental data, time-series data, or cross-section data. In this case, cross-section
CASE: DEMAND ESTIMATION and ELASTICITY: Soft Drinks in the U.SDemand can be estimated with experimental data, time-series data, or cross-section data. In this case, cross-section data appear in the Excel file. Soft drinkconsumption in cans per capita per year is related to six-pack price, income per capita, and mean temperature across the 48 contiguous states in the United States.Questions:Consider variables quantity sold (Cans per capita per year) and price only:A.)Write down the (linear) regression model for this case.B. )Estimate the demand for softdrinks using Excel. Provide the results here.C.)Interpret the coefficients of the parameters estimated.D.)Test the hypothesis: Ho: b = 0 (where b is the slope).E.)Describe the overall goodness of fit of the model and the overall explanatorypower of the mode.
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