RQ3.md

Reading Quiz 3

1. Explain what the problem is with the IIA property of logit models in context of the "red bus / blue bus / car" choice set.

2. What is the interpretation of the parameter lambda in a nested logit model (as denoted by Train)?

3. True/False/Uncertain: In a nested logit model, IIA holds between alternatives in the same nest. Explain your answer.

4. True/False/Uncertain: In general, the nested logit log likelihood function is globally concave. Explain your answer.

5. Besides nested logit, list at least two other GEV models that Train discusses.