i. State the transformed regression ii. State the null hypothesis that corresponds to constant returns to scale with respect to the transformed regression's coefcients 2. Antitrust authorities are concerned that airline companies use their market power to charge higher fares in the U.S. The dataset airlinefares2000.dta records average fares and other characteristics of the most popular U.S. origin -destination pairs (e.g. Boston Chicago) for the year 2000: [fare log of average dollar fare on route dist distance of the route , in ('000s of miles ) passen average number of passengers per day on route ('0005) concen concentration : market share of the biggest airline carrier on route measured in terms of passengers carried (ranging from 0.1 to 1) {a} Regress [fare on dist , passen and (:0an ,and report your results in the regular way with heteroskedasticity-robust standard errors. ( b) What is the interpretation of the coefcient on passcn ? (0) Based on your OLS estimates ,and assuming the OLS assumptions hold , what is the partial effect on prices of the largest carrier's market share? Is your answer consistent with the hypothesis that firms use their market power to charge higher prices ? ( d) Use a quadratic specication to test whether fares are affected by market shares linearly. (e) Holding all else xed , what is the marginal effect of concentration on fares when concentration is 0.2, 0.7 and 0,9? (f) Suggest an economic explanation that is consistent with your results. {g} Suggest a specification and explain how you would use it to test whether market power affects fares similarly on more popular and less popular routes. Write down the model and the null hypothesis , and carry out the estimation and the test