Let’s assume that an economist wants to measure the effect o…
Let’s assume that an economist wants to measure the effect of a prime membership card on consumers’ purchase volume. The economist collects the sample and runs the linear regressions as follows: ‘new_pv’: purchase volume of a consumer (dependent variable) ‘prime_card’ : prime card member (1) or not (0). – binary dummy variable ‘age’: age of a consumer ‘income’: income of a consumer ‘prime_card: income’: interaction terms between prime_card and income variables. Based on model 1, 1 year increase in age variable will (1) _______________ (a. increase, b. decrease; 2 points) consumer purchase volumes by (2) _______________ (number; 1 point) at statistically (3) _______________(a. insignificant, b. significant 10%, c. significant 5%, d. significant 1%; 1 point).