For the polynomial regression model,
A) you need new estimation techniques since the OLS assumptions do not apply any longer.
B) the techniques for estimation and inference developed for multiple regression can be applied.
C) you can still use OLS estimation techniques, but the t-statistics do not have an asymptotic normal distribution.
D) the critical values from the normal distribution have to be changed to 1.962, 1.963, etc.
Answer: B) the techniques for estimation and inference developed for multiple regression can be applied.
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“The hotter it gets, the more water people drink.” This statement implies that the relationship between temperature and water consumption must have a
A. negative slope. B. positive slope. C. slope always equal to one. D. slope always equal to 45 degrees.
In monopolistic competition, when firms make an economic profit
A) the existing firms continue to make an economic profit in the long run because of product differentiation. B) new firms enter the industry so that the price falls and the economic profit eventually falls to zero. C) new firms enter the industry so that output decreases and the economic profit increases. D) new firms enter the industry so that output increases and the economic profit increases.
Refer to Figure 19-7. If the Indian government pegs its currency to the dollar at a value above $.02/rupee, we would say the currency is
A) parity valued. B) undervalued. C) overvalued. D) equilibrium valued.
Using the Figure 13.3 above explain why this firm could not possibly represent a monopolist. What type of firm is represented by this graph and why?
What will be an ideal response?