Refer to the information provided in Figure 6.2 below to answer the question(s) that follow.
Figure 6.2Refer to Figure 6.2. Assume Mr. Lingle's budget constraint is AC. If the price of a beer is $3, the price of a gardenburger is
A. $1.50.
B. 3.00.
C. $6.00.
D. $12.00.
Answer: B
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Interpreting the intercept in a sample regression function is
A) not reasonable because you never observe values of the explanatory variables around the origin. B) reasonable because under certain conditions the estimator is BLUE. C) reasonable if your sample contains values of Xi around the origin. D) not reasonable because economists are interested in the effect of a change in X on the change in Y.
When a person's income decreases, the slope of the individual's budget constraint stays the same because:
A. everything is relatively more expensive now. B. everything is relatively less expensive now. C. the relative prices of the goods haven't changed. D. the prices of the goods change in the same proportion.
Economists normally
a. do not try to explain people's tastes, but they do try to explain what happens when tastes change b. believe that they must be able to explain people's tastes in order to explain what happens when tastes change. c. do not believe that people's tastes determine demand, so they ignore the subject of tastes. d. incorporate tastes into economic models only to the extent that tastes determine whether pairs of goods are substitutes or complements.
A private good is characterized by excludability and depletability.
Answer the following statement true (T) or false (F)