PRINCIPLES OF MICROECONOMICS LOOSE LEAF
12th Edition
ISBN: 9780134081083
Author: CASE
Publisher: PEARSON
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Chapter 22, Problem 4.1P
To determine
Draw the consumption function then calculate the error term and the sum total.
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Students have asked these similar questions
A first year student estimated a linear consumption function and found out that Ct = 200 + 0.65Yc + 0.25 Ct t-1. Give economic interpretation of the above result, clearly explaining the meaning of the intercept, variables and the coefficients.
The demand equation for a product for a product brand of mackerel is given by the equation
Qx=50-7Px+0.002I+12Py
Where Qx=monthly consumption per family in cartons
Px=price per carton of makerel=GHC 2.00
I=median annual family income=GHC20,000
Py=price per carton of competing brand of mackerel=2.5
Required:
i.At the stated values of the explanatory variables,calculate the consumption of makerel(cartons).
ii.what is the relationship between Good x and Good y?
iii.what is the nature of Good x ?
iv.Suppose the median annual family income increases to GHC40,000,What will be your new consumptino for Good x?
v.Suppose that the price per carton of competing brand increases GHC3.00, What will be your new consumption for Good x?
On average, the per-capita grocery spending in Maine takes up 9.08% of all personal consumption spending compared with 7.49% nationwide. Could either or both of these consumption figures be considered a point estimate? Explain your reasoning.
Chapter 22 Solutions
PRINCIPLES OF MICROECONOMICS LOOSE LEAF
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