Differentiate between the independent and dependent variables in an economic relationship
Please provide the best answer for the statement.
The dependent variable changes as a consequence of the change in the independent variable. By specifying one variable as the dependent variable, a causal relationship is implied with changes in the independent variable causing changes in the dependent variable. The dependent variable is the “effect” or outcome.
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The elasticity of a straight-line demand curve is the same as its slope.
Answer the following statement true (T) or false (F)
Demand for staples such as dairy products and bread is likely to be both income and price inelastic
Indicate whether the statement is true or false
In the short run, a firm will stay in business as long as:
a. price equals average revenue. b. marginal revenue is greater than or equal to marginal cost. c. price exceeds average variable cost. d. price is less than average variable cost.
If the price of a product falls below average total cost in the short run, the firm
a. has an economic profit b. cannot cover total fixed costs c. experiences a loss d. must always shut down e. should expand output until MC = MR