WarriorsArt 21, Inc. Art 21 – Artinthe21st Century (airingonPBS)Public Road Productions and Wieden & Kennedy(airedonSundance Channel) Nimrod NationUniversal Media
Studiosinassociation with Broadway Video Television and Little Stranger, Inc. 30 Rock2008Recipient AreaofExcellenceSichuan Television Award forcoverageoftheSichuan
earthquakeNPR Award foron-scene coverage by Melissa Block and Robert Siegel from Chengdu, China during and after theSichuan earthquake"36 YearsinSolitary: Murder, Death and
JusticeonAngola,"areport by Laura Sullivan which questioned theroleoftwo prisoners inaguard's 1972 murder at Louisiana State PenitentiaryChicago Public Radio and thenews divisionofNPR This
American Life, for"The Giant PoolofMoney," which looked at theearly stagesofthesubprime mortgage crisisLeverage and Closest totheHole Productionsinassociation with HBO Entertainment
EntourageHBO Documentary Filmsinassociation with Vermillion Films, Inc. Hear and NowMaysles Filmsinassociation with HBO Documentary Films and CVJ The
GatesTed Leonsis Productionsinassociation with HBO Documentary Films NankingPlaytoneinassociation with HBO Films John AdamsWWL-TV/New Orleans, LA Award
fora seriesofreports by Lee Zurik exposing questionable financial practices by theNew Orleans Affordable Homeownership programThe New York Times Award forthenewspaper's website
(NYTimes.com) and its innovationsinonline journalism, highlighting "ChoosingaPresident" and thereportingofLizette Alvarez, Shayla Harris, Rob Harris, Katharine Q. Seelye, and Ben
WerschkulKartemquin Educational Films and Independent Television Service Independent Lens, forMapping Stem Cell Research: Terra IncognitaMosaic Films, Independent Television
Service, and Corporation forPublic Broadcasting Independent Lens, forKing CornLaboratory X, Inc., American Documentary, Inc., P.O.V., Center forAsian American Media, and PBS POV,
forCampaign,adocumentary by Kazuhiro Soda aboutaLiberal Democratic Party candidate fora city council seat inasuburbofTokyoSNL Studiosinassociation with Broadway Video Saturday Night Live,
forits 2008 political satireABC News HopkinsABC Studios LostWETA-TV/Washington, DC and PBS Washington Week with Gwen Ifill & National JournalThe Metropolitan Opera
Associationinassociation with PBS and WNET/New York, NY The Metropolitan Opera: LiveinHD SeriesNBC Nightly News "TipoftheSpear,"aseriesofreports with Richard
Engel followingamilitary unitinAfghanistanYouTube Award totheGoogle independent subsidiary and its "promotingafree exchangeofideas... around theworld"NDR Fernsehen and Shanghai
Media Group The Red Race, about thetrainingofgymnastsinChinaKorean Broadcasting System Jungle FishHearst-Argyle Television Institutional Award for"Commitment
2008,"inwhich Hearst-Argyle stations devoted at least 10 minutes per day tocandidate and issues coverageinthe30 days leading tothe2008 electionsTurner Classic Movies Institutional Award
totheclassic film network and its commitment to"the placeoffilminsocial and cultural experience"The Onion Award forOnion News Network60 Minutes (CBS News) "Lifeline,"areport by
Scott Pelley profiling operationsofRemote Area MedicalintheUnited StatesWGBH-TV (Boston, MA)/NOVA, National Geographic Television, and John Rubin Productions, Inc. Ape GeniusSony
Pictures Television, High Bridge Productions, and Gran Via Productions Breaking BadESPN Films and Shoot theMoon Productions Black MagicNBC and Zhang Yimou Award fortheopening
ceremonyoftheBeijing OlympicsKMGH-TV/Denver, CO "Failing theChildren: Deadly Mistakes,"
GUJARATI’S EBE SOLUTIONS MANUAL
CHAPTER 1 EXERCISES
1.1. Consider the regression results given in Table 1.2.
a. Suppose you want to test the hypothesis that the true or population regression coefficient of
the education variable is 1. How would you test this hypothesis? Show the necessary
calculations.
The equation we are looking at is:
wagei = b1 + b2*(femalei) + b3*(nonwhitei) + b4*(unioni) + b5*(educationi) + b6*(experi) + ei
Here we are testing:
H0: β5 = 1
H1: β5 ≠ 1
From Table 1.2, we have: t = (1.370301 - 1)/0.065904 = 5.618794.
From the t table, the critical t statistic for α = 1% is 2.576 (df = 1289 – 6 = 1283, so we can use df =
∞). Since 5.619 > 2.576, we can easily reject the null hypothesis at the 1% level.
b. Would you reject or not reject the hypothesis that the true union regression coefficient is
1?
Here we are testing:
H0: β4 = 1
H1: β4 ≠ 1
From Table 1.2, we have: t = (1.095976 - 1)/0.506078 = 0.189647.
From the t table, the critical t statistic for α = 10% is 1.645 (using df = ∞). Since 0.190 < 1.645, we
cannot even reject the null hypothesis at the 10% level. (Note that from the output, if we were testing H0:
β4 = 0 vs. H1: β4 ≠ 0, we could reject the null hypothesis at the 5% level.)
c. Can you take the logs of the nominal variables, such as gender, race and union status?
Why or why not?
No, because these are categorical variables that often take values of 0 or 1. The natural log of 1 is
0, and the natural log of 0 is undefined. Moreover, taking the natural log would not be helpful as
the values of the nominal variables to not have a specific meaning.
d. What other variables are missing from the model?
We could have included control variables for region, marital status, and number of children on the
right-hand side. Instead of including a continuous variable for education, we could have controlled
,for degrees (high school graduate, college graduate, etc). An indicator for the business cycle (such
as the unemployment rate) may be helpful. Moreover, we could include state-level policies on the
minimum wage and right-to-work laws.
e. Would you run separate wage regressions for white and nonwhite workers, male and
female workers, and union and non-union workers? And how would you compare them?
We would if we felt the two groups were systematically different from one another. We can run
the models separately and conduct an F test to see if the two regressions are significantly different.
If they are, we should run them separately. The F statistic may be obtained by running the two
,together – the restricted model – then running the two separately – jointly, the unrestricted model.
We then obtain the residual sum of squares for the restricted model (RSSR) and the residual sum of
squares for the unrestricted model (RSSUR, equal to RSS1 + RSS2 from two separate models). F =
[(RSSR – RSSUR)/k] / [RSSUR/(n-2k)] ~ Fk,n-2k. I would then see which model was a better predictor
of the outcome variable, wage.
f. Some states have right-to-work laws (i.e., union membership is not mandatory) and some
do not have such laws (i.e, union membership is permitted). Is it worth adding a dummy
variable taking the value of 1 if the right-to-work laws are present and 0 otherwise? A priori,
what would you expect if this variable is added to the model?
Since we would expect these laws to have an effect on wage, it may be worth adding this variable.
A priori, we would expect this variable to have a negative effect on wage, as union wages are
generally higher than nonunion wages.
WarriorsArt 21, Inc. Art 21 – Artinthe21st Century (airingonPBS)Public Road Productions and Wieden & Kennedy(airedonSundance Channel) Nimrod
NationUniversal Media Studiosinassociation with Broadway Video Television and Little Stranger, Inc. 30 Rock2008Recipient AreaofExcellenceSichuan
Television Award forcoverageoftheSichuan earthquakeNPR Award foron-scene coverage by Melissa Block and Robert Siegel from Chengdu, China during and after
theSichuan earthquake"36 YearsinSolitary: Murder, Death and JusticeonAngola,"areport by Laura Sullivan which questioned theroleoftwo prisoners inaguard's 1972 murder at
Louisiana State PenitentiaryChicago Public Radio and thenews divisionofNPR This American Life, for"The Giant PoolofMoney," which looked at theearly
stagesofthesubprime mortgage crisisLeverage and Closest totheHole Productionsinassociation with HBO Entertainment EntourageHBO Documentary Filmsinassociation
with Vermillion Films, Inc. Hear and NowMaysles Filmsinassociation with HBO Documentary Films and CVJ The GatesTed Leonsis Productionsinassociation
with HBO Documentary Films NankingPlaytoneinassociation with HBO Films John AdamsWWL-TV/New Orleans, LA Award fora seriesofreports by Lee
Zurik exposing questionable financial practices by theNew Orleans Affordable Homeownership programThe New York Times Award forthenewspaper's website
(NYTimes.com) and its innovationsinonline journalism, highlighting "ChoosingaPresident" and thereportingofLizette Alvarez, Shayla Harris, Rob Harris, Katharine Q. Seelye, and
Ben WerschkulKartemquin Educational Films and Independent Television Service Independent Lens, forMapping Stem Cell Research: Terra IncognitaMosaic Films,
Independent Television Service, and Corporation forPublic Broadcasting Independent Lens, forKing CornLaboratory X, Inc., American Documentary, Inc., P.O.V.,
Center forAsian American Media, and PBS POV, forCampaign,adocumentary by Kazuhiro Soda aboutaLiberal Democratic Party candidate fora city council seat
inasuburbofTokyoSNL Studiosinassociation with Broadway Video Saturday Night Live, forits 2008 political satireABC News HopkinsABC Studios LostWETA-
TV/Washington, DC and PBS Washington Week with Gwen Ifill & National JournalThe Metropolitan Opera Associationinassociation with PBS and WNET/New York,
NY The Metropolitan Opera: LiveinHD SeriesNBC Nightly News "TipoftheSpear,"aseriesofreports with Richard Engel followingamilitary
unitinAfghanistanYouTube Award totheGoogle independent subsidiary and its "promotingafree exchangeofideas... around theworld"NDR Fernsehen and Shanghai
Media Group The Red Race, about thetrainingofgymnastsinChinaKorean Broadcasting System Jungle FishHearst-Argyle Television Institutional Award
for"Commitment 2008,"inwhich Hearst-Argyle stations devoted at least 10 minutes per day tocandidate and issues coverageinthe30 days leading tothe2008 electionsTurner Classic
Movies Institutional Award totheclassic film network and its commitment to"the placeoffilminsocial and cultural experience"The Onion Award forOnion News
Network60 Minutes (CBS News) "Lifeline,"areport by Scott Pelley profiling operationsofRemote Area MedicalintheUnited StatesWGBH-TV (Boston, MA)/NOVA,
National Geographic Television, and John Rubin Productions, Inc. Ape GeniusSony Pictures Television, High Bridge Productions, and Gran Via Productions
Breaking BadESPN Films and Shoot theMoon Productions Black MagicNBC and Zhang Yimou Award fortheopening ceremonyoftheBeijing OlympicsKMGH-
TV/Denver, CO "Failing theChildren: Deadly Mistakes,"
h. Would you add the age of the worker as an explanatory variable to the model? Why or
why not?
No, we would not add this variable to the model. This is because the variable Exper is defined as
(age – education – 6), so it would be perfectly collinear and not add any new information to the
model.
CHAPTER 2 EXERCISES
2.1. Consider the following production function, known in the literature as the transcendental
production function (TPF).
Qi B1LBi 2 K iB3 eB4 Li B5 Ki
where Q, L and K represent output, labor and capital, respectively.
(a) How would you linearize this function? (Hint: logarithms.)
Taking the natural log of both sides, the transcendental production function above can be written
in linear form as:
ln Qi ln B1 B2 ln Li B3 ln Ki B4 Li B5 K i ui
(b) What is the interpretation of the various coefficients in the TPF?
The coefficients may be interpreted as follows:
ln B1 is the y-intercept, which may not have any viable economic interpretation, although B1 may
be interpreted as a technology constant in the Cobb-Douglas production function.
The elasticity of output with respect to labor may be interpreted as (B2 + B4*L). This is because
ln Qi ln Li
1
L
, B4 ln Qi
B2 B4 L .
B2 Reca ln Li
l
ll
that n
Q
i
.
Similarly, the elasticity of output with respect to capital can be expressed as (B3 + B5*K).
(c) Given the data in Table 2.1, estimate the parameters of the TPF.
The parameters of the transcendental production function are given in the following Stata
output:
. reg lnoutput lnlabor lncapital labor capital
Source | SS df MS Number of obs = 51
-------------+------------------------------ F( 4, 46) = 312.65
Model | 91.95773 4 22.9894325 Prob > F = 0.0000
Residual | 3.38240102 46 .073530457 R-squared = 0.9645
-------------+------------------------------ Adj R-squared = 0.9614
Total | 95.340131 50 1.90680262 Root MSE = .27116
lnoutput | Coef. Std. Err. t P>|t| [95% Conf. Interval]
-------------+----------------------------------------------------------------
lnlabor | .5208141 .1347469 3.87 0.000 .2495826 .7920456
lncapital | .4717828 .1231899 3.83 0.000 .2238144 .7197511
labor | -2.52e-07 4.20e-07 -0.60 0.552 -1.10e-06 5.94e-07
capital | 3.55e-08 5.30e-08 0.67 0.506 -7.11e-08 1.42e-07
_cons | 3.949841 .5660371 6.98 0.000 2.810468 5.089215
B1 = e3.949841 = 51.9271.
B2 = 0.5208141
B3 = 0.4717828
B4 = -2.52e-07
Studiosinassociation with Broadway Video Television and Little Stranger, Inc. 30 Rock2008Recipient AreaofExcellenceSichuan Television Award forcoverageoftheSichuan
earthquakeNPR Award foron-scene coverage by Melissa Block and Robert Siegel from Chengdu, China during and after theSichuan earthquake"36 YearsinSolitary: Murder, Death and
JusticeonAngola,"areport by Laura Sullivan which questioned theroleoftwo prisoners inaguard's 1972 murder at Louisiana State PenitentiaryChicago Public Radio and thenews divisionofNPR This
American Life, for"The Giant PoolofMoney," which looked at theearly stagesofthesubprime mortgage crisisLeverage and Closest totheHole Productionsinassociation with HBO Entertainment
EntourageHBO Documentary Filmsinassociation with Vermillion Films, Inc. Hear and NowMaysles Filmsinassociation with HBO Documentary Films and CVJ The
GatesTed Leonsis Productionsinassociation with HBO Documentary Films NankingPlaytoneinassociation with HBO Films John AdamsWWL-TV/New Orleans, LA Award
fora seriesofreports by Lee Zurik exposing questionable financial practices by theNew Orleans Affordable Homeownership programThe New York Times Award forthenewspaper's website
(NYTimes.com) and its innovationsinonline journalism, highlighting "ChoosingaPresident" and thereportingofLizette Alvarez, Shayla Harris, Rob Harris, Katharine Q. Seelye, and Ben
WerschkulKartemquin Educational Films and Independent Television Service Independent Lens, forMapping Stem Cell Research: Terra IncognitaMosaic Films, Independent Television
Service, and Corporation forPublic Broadcasting Independent Lens, forKing CornLaboratory X, Inc., American Documentary, Inc., P.O.V., Center forAsian American Media, and PBS POV,
forCampaign,adocumentary by Kazuhiro Soda aboutaLiberal Democratic Party candidate fora city council seat inasuburbofTokyoSNL Studiosinassociation with Broadway Video Saturday Night Live,
forits 2008 political satireABC News HopkinsABC Studios LostWETA-TV/Washington, DC and PBS Washington Week with Gwen Ifill & National JournalThe Metropolitan Opera
Associationinassociation with PBS and WNET/New York, NY The Metropolitan Opera: LiveinHD SeriesNBC Nightly News "TipoftheSpear,"aseriesofreports with Richard
Engel followingamilitary unitinAfghanistanYouTube Award totheGoogle independent subsidiary and its "promotingafree exchangeofideas... around theworld"NDR Fernsehen and Shanghai
Media Group The Red Race, about thetrainingofgymnastsinChinaKorean Broadcasting System Jungle FishHearst-Argyle Television Institutional Award for"Commitment
2008,"inwhich Hearst-Argyle stations devoted at least 10 minutes per day tocandidate and issues coverageinthe30 days leading tothe2008 electionsTurner Classic Movies Institutional Award
totheclassic film network and its commitment to"the placeoffilminsocial and cultural experience"The Onion Award forOnion News Network60 Minutes (CBS News) "Lifeline,"areport by
Scott Pelley profiling operationsofRemote Area MedicalintheUnited StatesWGBH-TV (Boston, MA)/NOVA, National Geographic Television, and John Rubin Productions, Inc. Ape GeniusSony
Pictures Television, High Bridge Productions, and Gran Via Productions Breaking BadESPN Films and Shoot theMoon Productions Black MagicNBC and Zhang Yimou Award fortheopening
ceremonyoftheBeijing OlympicsKMGH-TV/Denver, CO "Failing theChildren: Deadly Mistakes,"
GUJARATI’S EBE SOLUTIONS MANUAL
CHAPTER 1 EXERCISES
1.1. Consider the regression results given in Table 1.2.
a. Suppose you want to test the hypothesis that the true or population regression coefficient of
the education variable is 1. How would you test this hypothesis? Show the necessary
calculations.
The equation we are looking at is:
wagei = b1 + b2*(femalei) + b3*(nonwhitei) + b4*(unioni) + b5*(educationi) + b6*(experi) + ei
Here we are testing:
H0: β5 = 1
H1: β5 ≠ 1
From Table 1.2, we have: t = (1.370301 - 1)/0.065904 = 5.618794.
From the t table, the critical t statistic for α = 1% is 2.576 (df = 1289 – 6 = 1283, so we can use df =
∞). Since 5.619 > 2.576, we can easily reject the null hypothesis at the 1% level.
b. Would you reject or not reject the hypothesis that the true union regression coefficient is
1?
Here we are testing:
H0: β4 = 1
H1: β4 ≠ 1
From Table 1.2, we have: t = (1.095976 - 1)/0.506078 = 0.189647.
From the t table, the critical t statistic for α = 10% is 1.645 (using df = ∞). Since 0.190 < 1.645, we
cannot even reject the null hypothesis at the 10% level. (Note that from the output, if we were testing H0:
β4 = 0 vs. H1: β4 ≠ 0, we could reject the null hypothesis at the 5% level.)
c. Can you take the logs of the nominal variables, such as gender, race and union status?
Why or why not?
No, because these are categorical variables that often take values of 0 or 1. The natural log of 1 is
0, and the natural log of 0 is undefined. Moreover, taking the natural log would not be helpful as
the values of the nominal variables to not have a specific meaning.
d. What other variables are missing from the model?
We could have included control variables for region, marital status, and number of children on the
right-hand side. Instead of including a continuous variable for education, we could have controlled
,for degrees (high school graduate, college graduate, etc). An indicator for the business cycle (such
as the unemployment rate) may be helpful. Moreover, we could include state-level policies on the
minimum wage and right-to-work laws.
e. Would you run separate wage regressions for white and nonwhite workers, male and
female workers, and union and non-union workers? And how would you compare them?
We would if we felt the two groups were systematically different from one another. We can run
the models separately and conduct an F test to see if the two regressions are significantly different.
If they are, we should run them separately. The F statistic may be obtained by running the two
,together – the restricted model – then running the two separately – jointly, the unrestricted model.
We then obtain the residual sum of squares for the restricted model (RSSR) and the residual sum of
squares for the unrestricted model (RSSUR, equal to RSS1 + RSS2 from two separate models). F =
[(RSSR – RSSUR)/k] / [RSSUR/(n-2k)] ~ Fk,n-2k. I would then see which model was a better predictor
of the outcome variable, wage.
f. Some states have right-to-work laws (i.e., union membership is not mandatory) and some
do not have such laws (i.e, union membership is permitted). Is it worth adding a dummy
variable taking the value of 1 if the right-to-work laws are present and 0 otherwise? A priori,
what would you expect if this variable is added to the model?
Since we would expect these laws to have an effect on wage, it may be worth adding this variable.
A priori, we would expect this variable to have a negative effect on wage, as union wages are
generally higher than nonunion wages.
WarriorsArt 21, Inc. Art 21 – Artinthe21st Century (airingonPBS)Public Road Productions and Wieden & Kennedy(airedonSundance Channel) Nimrod
NationUniversal Media Studiosinassociation with Broadway Video Television and Little Stranger, Inc. 30 Rock2008Recipient AreaofExcellenceSichuan
Television Award forcoverageoftheSichuan earthquakeNPR Award foron-scene coverage by Melissa Block and Robert Siegel from Chengdu, China during and after
theSichuan earthquake"36 YearsinSolitary: Murder, Death and JusticeonAngola,"areport by Laura Sullivan which questioned theroleoftwo prisoners inaguard's 1972 murder at
Louisiana State PenitentiaryChicago Public Radio and thenews divisionofNPR This American Life, for"The Giant PoolofMoney," which looked at theearly
stagesofthesubprime mortgage crisisLeverage and Closest totheHole Productionsinassociation with HBO Entertainment EntourageHBO Documentary Filmsinassociation
with Vermillion Films, Inc. Hear and NowMaysles Filmsinassociation with HBO Documentary Films and CVJ The GatesTed Leonsis Productionsinassociation
with HBO Documentary Films NankingPlaytoneinassociation with HBO Films John AdamsWWL-TV/New Orleans, LA Award fora seriesofreports by Lee
Zurik exposing questionable financial practices by theNew Orleans Affordable Homeownership programThe New York Times Award forthenewspaper's website
(NYTimes.com) and its innovationsinonline journalism, highlighting "ChoosingaPresident" and thereportingofLizette Alvarez, Shayla Harris, Rob Harris, Katharine Q. Seelye, and
Ben WerschkulKartemquin Educational Films and Independent Television Service Independent Lens, forMapping Stem Cell Research: Terra IncognitaMosaic Films,
Independent Television Service, and Corporation forPublic Broadcasting Independent Lens, forKing CornLaboratory X, Inc., American Documentary, Inc., P.O.V.,
Center forAsian American Media, and PBS POV, forCampaign,adocumentary by Kazuhiro Soda aboutaLiberal Democratic Party candidate fora city council seat
inasuburbofTokyoSNL Studiosinassociation with Broadway Video Saturday Night Live, forits 2008 political satireABC News HopkinsABC Studios LostWETA-
TV/Washington, DC and PBS Washington Week with Gwen Ifill & National JournalThe Metropolitan Opera Associationinassociation with PBS and WNET/New York,
NY The Metropolitan Opera: LiveinHD SeriesNBC Nightly News "TipoftheSpear,"aseriesofreports with Richard Engel followingamilitary
unitinAfghanistanYouTube Award totheGoogle independent subsidiary and its "promotingafree exchangeofideas... around theworld"NDR Fernsehen and Shanghai
Media Group The Red Race, about thetrainingofgymnastsinChinaKorean Broadcasting System Jungle FishHearst-Argyle Television Institutional Award
for"Commitment 2008,"inwhich Hearst-Argyle stations devoted at least 10 minutes per day tocandidate and issues coverageinthe30 days leading tothe2008 electionsTurner Classic
Movies Institutional Award totheclassic film network and its commitment to"the placeoffilminsocial and cultural experience"The Onion Award forOnion News
Network60 Minutes (CBS News) "Lifeline,"areport by Scott Pelley profiling operationsofRemote Area MedicalintheUnited StatesWGBH-TV (Boston, MA)/NOVA,
National Geographic Television, and John Rubin Productions, Inc. Ape GeniusSony Pictures Television, High Bridge Productions, and Gran Via Productions
Breaking BadESPN Films and Shoot theMoon Productions Black MagicNBC and Zhang Yimou Award fortheopening ceremonyoftheBeijing OlympicsKMGH-
TV/Denver, CO "Failing theChildren: Deadly Mistakes,"
h. Would you add the age of the worker as an explanatory variable to the model? Why or
why not?
No, we would not add this variable to the model. This is because the variable Exper is defined as
(age – education – 6), so it would be perfectly collinear and not add any new information to the
model.
CHAPTER 2 EXERCISES
2.1. Consider the following production function, known in the literature as the transcendental
production function (TPF).
Qi B1LBi 2 K iB3 eB4 Li B5 Ki
where Q, L and K represent output, labor and capital, respectively.
(a) How would you linearize this function? (Hint: logarithms.)
Taking the natural log of both sides, the transcendental production function above can be written
in linear form as:
ln Qi ln B1 B2 ln Li B3 ln Ki B4 Li B5 K i ui
(b) What is the interpretation of the various coefficients in the TPF?
The coefficients may be interpreted as follows:
ln B1 is the y-intercept, which may not have any viable economic interpretation, although B1 may
be interpreted as a technology constant in the Cobb-Douglas production function.
The elasticity of output with respect to labor may be interpreted as (B2 + B4*L). This is because
ln Qi ln Li
1
L
, B4 ln Qi
B2 B4 L .
B2 Reca ln Li
l
ll
that n
Q
i
.
Similarly, the elasticity of output with respect to capital can be expressed as (B3 + B5*K).
(c) Given the data in Table 2.1, estimate the parameters of the TPF.
The parameters of the transcendental production function are given in the following Stata
output:
. reg lnoutput lnlabor lncapital labor capital
Source | SS df MS Number of obs = 51
-------------+------------------------------ F( 4, 46) = 312.65
Model | 91.95773 4 22.9894325 Prob > F = 0.0000
Residual | 3.38240102 46 .073530457 R-squared = 0.9645
-------------+------------------------------ Adj R-squared = 0.9614
Total | 95.340131 50 1.90680262 Root MSE = .27116
lnoutput | Coef. Std. Err. t P>|t| [95% Conf. Interval]
-------------+----------------------------------------------------------------
lnlabor | .5208141 .1347469 3.87 0.000 .2495826 .7920456
lncapital | .4717828 .1231899 3.83 0.000 .2238144 .7197511
labor | -2.52e-07 4.20e-07 -0.60 0.552 -1.10e-06 5.94e-07
capital | 3.55e-08 5.30e-08 0.67 0.506 -7.11e-08 1.42e-07
_cons | 3.949841 .5660371 6.98 0.000 2.810468 5.089215
B1 = e3.949841 = 51.9271.
B2 = 0.5208141
B3 = 0.4717828
B4 = -2.52e-07
