Which is NOT a good practice for choosing a model? Select one: a. Considering theories, expert opinions, or prior knowledge on the model b. Checking residual plots c. Checking the outliers of the model d. Selective reporting of a finally chosen “significant” model
Q: two machines. You work for Midstates Solar Power. A manager asked you to analyze the following…
A: Capital recovery (CR) refers to the return that an investor gets on the initial investment made.…
Q: A fixed capital investment of P10,000,000 is required for a ed manufacturing plant and an estimated…
A: We have, (FC) Fixed capital is P10,000,000 (WC) Work capital is P2,500,000 Annual Depriciation is…
Q: 3 Five mutually exclusive, direct benefit alternatives are compared using the B/C method. The…
A: According to the benefit-cost ratio analysis, a project or alternative is economically justified if…
Q: Estimate the following model: purchase = β0 + β1traditional + β2aggregator + β3substack
A: The regression equation is of the form: purchase = β0 + β1 traditional + β2 aggregator + β3 substack…
Q: For the regression model Y=B1 + B₂X2 + B3X3 + e, the following estimation results are obtained:
A: A regression model states the functional relationship between dependent and independent variables.…
Q: 1. In the Bertrand model with product differentiation, suppose the two Bertrand Firms face the…
A: In a Bertrand duopoly with differentiated products both the firm compete in prices by setting price…
Q: Using your knowledge and understanding of supply and demand analysis…
A: The study of how buyers and sellers agree on prices and quantity terms for transactions is known as…
Q: Costs and revenues C р 0 ATC Qe MC Most firms will shut down. D = AR = MR Output Given the situation…
A: In the long run, the industry operates at zero economic profits which means the average total cost…
Q: 12% per year. For the cash flows shown, use an annual worth comparison and an interest rate of First…
A: The annual worth (AW) value for an alternative will be inclusive of the two components: capital…
Q: Consider the following regression estimates (ID6) Source Model Residual Total wage educ exper exper2…
A: From the given regression results, the coefficient of the constant term is -3.96489, the coefficient…
Q: 4. Millie manufactures potteries which requires renting a workshop at AED 30,000 per month and…
A: Fixed Cost refer to those costs which are independent of the level of output whereas variable costs…
Q: 2- A rough rule of thumb for the chemical industry is that OMR 1 of annual sales required OMR 2 of…
A: As per the question OMR 1 Sales for 1% of fixed Capital investment Total Capital Investment = OMR…
Q: Microfinance institutions ultimately measure their success by the impact they have on their clients,…
A: Microfinance institutions (MFIs) provide small loans to those households/individuals who cannot…
Q: In 3-5 sentences, evaluate if the United States has been a leader in the global economy in recent…
A: United States is a highly developed market economy which has the largest level of nominal GDP in the…
Q: Consider the following 2-consumer, 2-good exchange economy: u¹(x1, x₂) = (x+x₂)² u²(x,x) = ln x² + 2…
A: The branch of economics concerned with the simultaneous determination of prices and quantities in…
Q: the demand function q = D(p)=317-p, find the following. For a) The elasticity b) The elasticity at…
A:
Q: Value of the final goods and services produced in a given year corrected for inflation in order to…
A: Base year prices are P0 and current year prices are P1. The volume of total final goods and…
Q: Q5 If 1(t) = 3000t (thousands of dollars per year) -a nonconstant flow- what will be the capital…
A: Given information of Numerical: I(t) = 3000t1/2Capital formation interval 1,4
Q: Problem 3: Well-Behaved Indifference Curves & Optimization [6 Points] Consider an Individual who…
A: Budget constraint: given the price of 2 goods and consumer’s income. The budget constraint shows…
Q: Currently what is used as the "base year" in the NIPA accounting system. A) 2010 B) 2012 C) 2008…
A: NIPA stands for National income and Product accounts. It measures the output and income in the…
Q: Question 1-5. Answer True, False or Uncertain. Briefly explain your answer.
A: Introduction 1. International Economics is the study of economic interactions between countries.…
Q: Now suppose the exchange rate is fixed with E=E¯. Explain how, if at all, a fixed exchange rate…
A: Introduction A foreign central bank's contractionary foreign monetary policy would reduce the amount…
Q: Suppose the proportion P of people affected by a certain disease is described by ln (P/1-P) = 0.1t…
A: Here, the given equation is: ln(P1-P)=0.1t
Q: Below is a table of production possibilities for a company that produces soft drink bottles and…
A: DISCLAIMER “Since you have asked multiple questions, we will solve the first 3 subparts question for…
Q: How can household borrow in the United States be Reduced? Write in 4 paragraph
A: Borrowing: In the Budget document, borrowing is categorized as a loan taken by the government and is…
Q: Problems associated towards unique outcomes in games where multiple Nash equilibria exist
A: Nash Equilibrium theory is the theory used in the Game Theory branch. It is used to determine the…
Q: For the regression model Y = B₁ + B2X2 + B3X3 + e, the following estimation results are obtained:…
A: Given Point estimate of β is β2^ =6.6 Estimated standard error of β2 is 7.2 Required: Lower bound…
Q: Integrate recent economic developments in regional trade arrangements
A: The modern picture of global trade is characterized by increasing bilateral and multilateral trade…
Q: In the Solow model with technological progress, suppose that the rate of depreciation is 10% per…
A: Long-term economic growth is the focus of the Solow growth model. Saving and investing are critical…
Q: In the graph you've just explored, by how much does the quantity of money demanded change if the…
A: Demand for the good and the price have an inverse/ negative relationship with each other. When the…
Q: Step 3. Draw another PPF of the economy with the axes labeled. Grab another color…
A: The production possibility frontier refers to the curve that shows combinations of two goods that…
Q: Kyoko and Rina are considering contributing toward the creation of a public park. Each can choose…
A: The public good is divided by non-rivalry and non-excludability. No one can decrease the utilization…
Q: The following graph shows the labor market for research assistants in the fictional country of…
A: Tax A tax is an expense levied by the government on taxpayers. Taxation generates the government's…
Q: Which of the following is a reason why private solutions are often ineffective at remedying…
A: Private decisions related to the production and consumption can result to inefficient allocations.…
Q: The chart below gives a firm's total cost of producing different levels of output. The profit…
A: For profit maximization, in a competitive firm the marginal cost should be equal to the marginal…
Q: = A. Consider a consumer whose preferences can be represented by Cobb-Douglas utility function u(x1,…
A: Given Consumer utility function: u(x1,x2)=x113x223 .......(1) The price of good 1…
Q: Suppose the Australian dollar floats against the US dollar and the demand for Australian dollars in…
A: Equilibrium is where demand equals supply. Demand curve is the graphical representation of demand…
Q: 13. Let M denote currency and demand deposits and B the stock of government bonds. Suppose that both…
A: Money is defined as any thing that is often used in a given country or socioeconomic context to pay…
Q: Refer to Figure 12.4. If the economy is currently at the intersection of AS and AD, stagflation…
A: A situation where the growth of the economy slows down, unemployment rises and prices increases…
Q: 16. The monetary base is composed of: Reserves a. b. C. Coins and notes issued by the Fed Currency…
A: "Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: In this question, you'll deal with two goods, and you'll have to solve for cross-price elasticity…
A: Here, for the cross price elasticity of demand, given information is: Old price of file cabinet:…
Q: By demonstrating competence in words the theory and evolution of international trade with emphasis…
A: The various explanations for international commerce are merely known as international trade…
Q: Between 2012 and 2022, the nominal GDP of Wonderland grew, on average, by 7% per year while her GDP…
A: labor productivity growth = % change in real output - % change in total number of labor The real…
Q: Which of the following is true about the Phillips curve? The empirical relationship between…
A: The Phillips curve explains an inverse trade-off or relation between the inflation and unemployment.…
Q: 7 (Ch 8) Homework Due in 5 days Answereu a In the long run, if a firm increases output and the…
A: Average Total Cost is obtained by dividing total cost incurred by the firm with the total output…
Q: Consider an economy than only produces two goods - Blueberries and Batteries. Step 1: Draw a…
A: A Production Possibility Frontier (PPF) is a graph that shows all the possible combinations of two…
Q: Flora and fana are examples of resources. True or false
A: Answer to the question is as follows:
Q: Consider a simple economy that produces two goods: cupcakes and muffins. The following table shows…
A: The real GDP and Nominal Gross Domestic Product (GDP) would quantify the total value of all items…
Q: A monopoly's economic profits are represented by [marginal cost minus price] times number of units…
A: Answer to the question is as follows:
Q: Consider a closed economy model where Y=C+I+G, consumption is given by the function C=90+0.8(Y−T),…
A: Y = C + I + G Budget deficit = G - T 10 = 60 - T T = 50 Y = 90 + 0.8 ( Y - 50 ) + 90 + 60 Y =…
q13b-
Which is NOT a good practice for choosing a model?
Checking residual plots
Checking the outliers of the model
Step by step
Solved in 3 steps
- q2a- Which case is NOT suitable for restricted least squares estimation imposing a restriction to the regression coefficients? Select one: a. When the null hypothesis of a restriction does make economic sense b. The restriction is plauisble according to expert opinions c. When the null hypothesis of a restriction does not make economic sense d. When the null hypothesis of a restriction cannot be rejected Clear my choiceA multiple regression model, K = a + bX + cY + dZ, is estimated regression software, which produces the following output: a. Are the estimates of a, b, c, and d statistically significant at the 1 percent significance level? b. How much of the total variation is explained by this regression equation? c. Is the overall regression equation statistically significant at the 1 percent level of significance? d. If X equals 50, Y equals 200, and Z equals 45, what value do you predict K will take?If a Winters' model for new car dealer sales, comes up with four seasonal indices with values of Q1 = 0.95, Q2 = 1.04, Q3 = 1.05, and Q4 = 0.96, the following can be interpreted: Multiple Choice Q1 sales are lower because of Q2 sales. Q1 sales are usually about 5 percent below an average quarter. Q1 sales are usually about 5 percent above an average quarter. Q1 sales are higher because of Q2 sales.
- Write (TRUE/FALSE) for each question. An observation with a large standardized residual value always generates a large Cook’sdistance value. (T/F)Leverage value detects unusual x values. (T/F)BIC gives heavier penalty on models with many variables than Cp or AIC. (T/F) As the tuning parameter λ → ∞, the coefficients of ridge regression tend to zero. (T/F)Like the least square coefficient, ridge regression coefficients are scale equivalent. (T/F)The shrinkage penalty is applied to all coefficient except for the intercept. (T/F) Lasso regression reduces the bias by increasing the tuning parameter. (T/F)The forecasting staff for the Prizer Corporation has developed a model to predict sales of its air-cushioned-ride snowmobiles. The model specifies that sales S vary jointly with disposable personal income Y and the population between ages 15 and 40, Z, and inversely with the price of the snowmobiles P. Based on past data, the best estimate of this relationship is S=kYZP where k has been estimated (with past data) to equal 100. If Y=11,000,Z=1,200, and P=20,000, what value would you predict for S? What happens if P is reduced to $17,500? How would you go about developing a value for k? What are the potential weaknesses of this model?tate whether the following statements are true or false with a brief explanation: a) Logit model is estimated by minimising the sum of the squares residuals of the model. b) In difference-in-differences analysis, the assumption of ‘parallel trends’ is generally testable. c) Suppose you have estimated a model Y = 0.2 – 0.7D + 2X + 0.4X*D. Y and X are continuous variables and D is a dummy variable. If D=1, the marginal effect of X on Y is always larger, and therefore the predicted Y is always larger, than in the case where D=0. d) The first order autoregressive model can be stationary or non-stationary. e) The bias in Instrumental Variables estimator depends on the number of observations.
- The following ACF plots were produced for raw data of monthly sales of two different variables, A and B. a) Explain which variable is likely to be easier to forecast. b) Explain how your answer to part a) would change if these were residuals of an ARIMA model instead of “raw data of monthly sales”.For each of the questions below, choose the correct answer(s) and providejustification in terms of why the other answer(s) are incorrect. Q2A. Which of the following are possible consequences of overfitting an ARIMAmodel?i. The model may have high bias.ii. The model may have high out-of-sample variance.iii. The model may have poor predictive performance.iv. All of the aboveHOTELLING MODEL Consider a market in which today’s crude oil price is $100/bbl, and the marginal cost of extracting another barrel of oil is $50. The interest rate is 10% per year. Assume that the market iscompetitive.a. What is the best prediction for the oil price 1, 2, 3, 4 and 5 years from now, based on the Hotelling model? Calculate the oil prices at the end of years 1, 2, 3, 4, and 5. The market suddenly learns that the marginal cost of extraction in years 2 and 3 will be only $40, after which the marginal cost is expected to fall to $20 for years 4 and 5.b. What is your prediction for future oil prices based on this new information? Calculate the oil prices at the end of years 1, 2, 3, 4, and 5. [Hint: assume that the price of year 1stays as in part a.]
- Estimate the following model: purchase = β0 + β1traditional + β2aggregator + β3substackIn general, what is true about the relationship between the Sum of Squared Residuals in the restricted and unrestricted model? a. SSRr = R-squared * SSRur b. SSRr < SSRur c. SSRr > SSRur d. SSRr = SSRurDescribe the recommended approach towards determining model specification.How does the R2 help in determining an appropriate model? Is theideal model the one with the highest R2? Should a regressor be included in the model if it increases the model R2?