Question
The demand function below is estimated using the data generated by a randomized controlled trial: Lnq x d =a+b*Lnp x +c*Lnp Y +d*Lnp z +e
The demand function below is estimated using the data generated by a randomized controlled trial:
Lnqxd=a+b*Lnpx+c*LnpY+d*Lnpz+e
where qxdis the quantity demanded of the product of interest (X), pxis the price of the product of interest (X), pyis the price of a substitute product (Y), and pzis the price of a complement product (Z). Also, e is the error term. The table below shows the 95% confidence interval estimation for parameters b, c, and d:
Parameter | Lower Limit of 95%CIE | Upper Limit of 95%CIE |
b | -0.052 | -0.031 |
c | -0.025 | +0.045 |
d | -0.154 | -0.075 |
16. Consider thelowerlimit of 95%CIE for parameter b. A 10 percent increase in price of X is expected to reduce the demand for X by _____ percent.
Note: Round your answer to two decimal points.
17. Consider theupperlimit of 95%CIE for parameter b. A 10 percent increase in price of X is expected to reduce the demand for X by _____ percent.
Note: Round your answer to two decimal points.
I tried it and answers are not 5.2% and 3.1%
any help?
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