Question 8:

A. Log regression:
. regress logoutput logcapital loglabor

Source | SS df MS Number of obs = 27

-------------+------------------------------ F( 2, 24) = 407.50

Model | 5.37753949 2 2.68876975 Prob > F = 0.0000

Residual | .158356562 24 .00659819 R-squared = 0.9714

-------------+------------------------------ Adj R-squared = 0.9690

Total | 5.53589605 26 .212919079 Root MSE = .08123

------------------------------------------------------------------------------

logoutput | Coef. Std. Err. t P>|t| [95% Conf. Interval]

-------------+----------------------------------------------------------------

logcapital | .1398108 .1653906 0.85 0.406 -.2015386 .4811603

loglabor | 2.328398 .5994894 3.88 0.001 1.091112 3.565683

_cons | -11.93657 3.211061 -3.72 0.001 -18.56388 -5.30927

B. Descriptive and Correlation:

Descriptive:
. summarize logoutput logcapital loglabor

Variable | Obs Mean Std. Dev. Min Max

-------------+--------------------------------------------------------

logoutput | 27 4.493912 .4614316 3.579567 4.933337

logcapital | 27 5.134726 .5826074 4.087656 5.881178

loglabor | 27 6.748245 .1607331 6.456769 6.92844

correlation:
. pwcorr logoutput logcapital loglabor

| logout~t logcap~l loglabor

-------------+---------------------------

logoutput | 1.0000

logcapital | 0.9764 1.0000

loglabor | 0.9852 0.9862 1.0000

C. Confidence interval:

. regress logoutput logcapital loglabor

Source | SS df MS Number of obs = 27

-------------+------------------------------ F( 2, 24) = 407.50

Model | 5.37753949 2 2.68876975 Prob > F = 0.0000

Residual | .158356562 24 .00659819 R-squared = 0.9714

-------------+------------------------------ Adj R-squared = 0.9690

Total | 5.53589605 26 .212919079 Root MSE = .08123

------------------------------------------------------------------------------

logoutput | Coef. Std. Err. t P>|t| [95% Conf. Interval]

-------------+----------------------------------------------------------------

logcapital | .1398108 .1653906 0.85 0.406 -.2015386 .4811603

loglabor | 2.328398 .5994894 3.88 0.001 1.091112 3.565683

_cons | -11.93657 3.211061 -3.72 0.001 -18.56388 -5.30927

D. Hypothesis testing at 1%:

. lincom logcapital-1, level(99)

( 1) logcapital = 1

------------------------------------------------------------------------------

logoutput | Coef. Std. Err. t P>|t| [99% Conf. Interval]

-------------+----------------------------------------------------------------

(1) | -.8601892 .1653906 -5.20 0.000 -1.322777 -.3976016

------------------------------------------------------------------------------
Interpretation
. lincom loglabor-1, level(99)

( 1) loglabor = 1

------------------------------------------------------------------------------

logoutput | Coef. Std. Err. t P>|t| [99% Conf. Interval]

-------------+----------------------------------------------------------------

(1) | 1.328398 .5994894 2.22 0.036 -.3483381 3.005133