Question

To test our hypotheses, consider the following model representing the supply of broilers at time t

Do the estimated parameters support the hypotheses (are the coefficients the expected sign, are they significant)?

Answer 1

1. The first hypothesis has expected sign because if the price of the broiler is high than the demand for broiler decrease due to the stock of chicks for sale in the future with the high price and the result is nonsignificant. at 1 %, 5% because p-value is greater than the alpha

2. for the second hypothesis has the expected sign with the significant level at 1%. because if the price of broiler increases then every producer want to more profit that leads to increase the number in broiler and reduction in egg market in the future market. they stock the chicks for the sale in future.

3. if the price of an egg is high then producer want to more produce egg rather than broiler to got more profit so demand for egg market increase that reduce the number of broilers. the hypothesis has the expected sign but not have a significant result. it means that the price of egg increase by 1$ then the quantity of broiler decreased by -0.58 unit.