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Consider the following regression model, log(CON)=Bot BI INC + B2 INC2 + B3 PRICE + u Where CON = Household consumption expenditure INC = Household

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Consider the following regression model, log(CON)=Bot BI INC + B2 INC2 + B3 PRICE + u Where CON = Household consumption expenditure INC = Household income INC2 = Household income squared PRICE = General price level Regression Estimates- Dependent variable: log(CON) Variables Coefficient Estimates and (Standard Errors) quation 1 Equation 2 Constant 1.2136 1.5731 (0.1961) (0.0849) INC 0.0029 (0.001) INC2 0.0013 (0.00051) PRICE -0.0081 -0.0095 0.0035 (0.0017) N (Number of Observations) 500 500 SSR (Sum of Squared Residuals) 145.63 184.09 R 0.52 0.45 You wanted to test whether income has a significant effect on household consumption. Which of the following represents your calculated value of test statistic? Ot=2.547 Ot=2.9 OF=268.267 OF=65.478

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