We are trying to estimate the annual demand for good Z, by using the following independent variables: X1 = price of good Z (in $), X2 = consumer income (in $) OLS estimation is based on the data for the years from 1975 to 1989. EViews output is shown below:

Questions:

Part a) Is the estimated (slope) coefficient of X1 and X2 significantly different from zero? (Use p-values)

Part b) State and interpret the coefficient of multiple determination for this model.

Part c) Test for autocorrelation at the 5% level of

significance.

Part d) Do you suspect a spurious regression? Why?

Dependent Variable: Y Method: Least Squares Sample: 19751989 Included observations: 15