When the R2 of a regression equation is very high, it indicates that
A) all the coefficients are statistically significant.
B) the intercept term has no economic meaning.
C) a high proportion of the variation in the dependent variable can be accounted for by the variation in the independent variables.
D) there is a good chance of serial correlation and so the equation must be discarded.
C
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The income elasticity of demand is ________ if the good is ________ good
A) positive; a normal B) positive; an inferior C) negative; a normal D) less than one; an inferior E) positive; a substitute
The AD curve is:
A. the combination of money and velocity growth rates that add up to a constant amount. B. the combination of inflation rates and real growth rates that add up to a constant amount. C. vertical at the economy's long-run real GDP growth rate. D. horizontal at the economy's long-run inflation rate.