Consider the model given by ln Y = β1 + β2 ln X2 + β3 ln X3 + β4 ln X4 + u, where Y = per capita consumption of tea, X2 = real disposable per capita income (measured in dollars), X3 = price of sugar (measured in dollars per pound), X4 = price of coffee (measured in dollars per pound). Suppose that according to economic theory, sugar and tea are complementary products. What would be the sign of the coefficient β3?

MCQs on Econometrics, which is the use of statistical methods to develop theories or test existing hypotheses in economics or finance.