Question
In: Statistics and Probability
1. A model regressing consumption (C) on income (I) and wealth (W) yielded the following results....
1. A model regressing consumption (C) on income (I) and wealth (W) yielded the following results. All variables are measured in thousands of dollars.
R2 = 0.86 R2 = 0.79 calc F = 17.42 n = 25
C = 402 + 0.83 I + 0.71 W
(0.71) (6.21) (5.47)
where the t-values are shown in parentheses.
a. What is the meaning of the intercept term?
b. Are the coefficients significant at the 5 percent level?
c. Is the overall model significant at the 10 percent level?
d. Construct a 99% confidence interval for the population regression coefficient linking wealth and consumption.
Solutions
Expert Solution
I have answered the question below
Please up vote for the same and thanks!!!
Do reach out in the comments for any queries
Answer:
a)
The meaning of the intercept is that the fixed compensation is 402 thousand dollars even when the income and wealth are zero
b)
c)
d)
orchestra answered 2 years agoRelated Solutions
7. Consider the following income-expenditure model of a closed economy. The aggregate consumption function is C...
7. Consider the following income-expenditure model of a closed
economy. The aggregate consumption function is C = 100 +0.8(Y – T);
taxes are T = 380; investment, I, is 300 and government
expenditure, G, is 200.
(a) Calculate the multiplier, equilibrium income and the
government budget surplus [6 marks]
(b) Now let taxes, T = 10 + 0.25Y. Recalculate the multiplier,
equilibrium income and the government budget surplus. Try to
explain any differences between your answers and your answers to...
7. Consider the following income-expenditure model of a closed economy. The aggregate consumption function is C...
7. Consider the following income-expenditure model of a closed
economy. The aggregate consumption function is C = 100 +0.8(Y – T);
taxes are T = 380; investment, I, is 300 and government
expenditure, G, is 200.
( a)Calculate the multiplier, equilibrium income and the
government budget surplus [6 marks]
(b)Now let taxes, T = 10 + 0.25Y. Recalculate the multiplier,
equilibrium income and the government budget surplus. Try to
explain any differences between your answers and your answers to
part...
Consider the following Keynesian income model: E = C + I + G + X-M C...
Consider the following Keynesian income model: E = C + I + G +
X-M C = 215 + 0.82Yd Yd = Y – T T = 60 + 0.33Y I = 400 G = 620 X =
310 M = 50 + 0.20Y In equilibrium, Y = E: a. calculate the
equilibrium level of income. b. calculate the amount of taxes
collected when the economy is at equilibrium level of income and
show whether the government budget is in...
2. Consider the simplified national income model: Y = C + I…………(1) Where Y...
2. Consider the simplified national income model:
Y = C + I…………(1)
Where Y is national income, C is consumption, and I is
investment. Consumption is determined by a behavioral equation,
which in this problem takes the form
C= 3000+ .75
Y……..(2)
Where Y and C are endogenous variables and Investment is
exogenous, and, initially we assume
I =1000……………….(3)
(2-a) Determine the equilibrium level of national income
(Y) and consumption (C) by using the matrix
(linear) algebra...
There are three theoretical bases for taxation: income taxes, consumption taxes, and wealth taxes. In Canada,...
There are three theoretical bases for taxation: income taxes,
consumption taxes, and wealth taxes. In Canada, we have a mixture
of all three.
Provide some thoughtful comments on one or more of these
theoretical bases of taxation. (Note: You could rave/rant about one
in particular or you could compare/contrast two of them or even all
three of them.)
（100 words）
In a study relating consumption expenditure (Y) on income (X2) and wealth (X3) based on 10...
In a study relating consumption expenditure (Y) on income (X2)
and wealth (X3) based on 10 observations , the following equation
was obtained
Yhat = 24.337 + 0.08764X2 - 0.0349X3
SE
(6.2801) (0.31438) (0.0301)
t
(3.875)
(2.7726)
(-1.1595)
i) In your opinion, what type of problem takes in this result?
Explain it
ii) What are the practical consequences of this
problem?
iii) What are the theoretical of this problem
iv) How to detect this problem?
v)In your judgement,...
Consider the following model of aggregate demand and supply. Consumption depends positively on disposable income with...
Consider the following model of aggregate demand and
supply. Consumption
depends positively on disposable income with a marginal propensity
to consume
between 0 and 1, investment depends negatively on the real interest
rate, and labour
supply depends positively on the real wage. The real interest rate
is the nominal
interest rate minus the rate of inflation. Prices are flexible, and
firms hire labour up
to the point where the marginal product of labour is equal to the
real wage.
Monetary...
Consider the following IS-LM model with a banking system: Consumption: C = 7 + 0.6YD Investment:...
Consider the following IS-LM model with a banking system:
Consumption:
C = 7 + 0.6YD
Investment:
I = 0.205Y − i
Government expenditure:
G = 10
Taxes:
T = 10
Money demand: Md / P = Y / i
Demand for reserves:
Rd =
0.375Dd
Demand for deposits:
Dd = (1 −
0.2)Md
Demand for currency:
CUd = 0.2Md
This says that consumers hold 20% (c = 0.2) of
their money as currency and the required reserve ratio is 37.5%...
1. GDP (Y) = C + I + G Consumption = 10 + .75Y Investment =...
1. GDP (Y) = C + I + G
Consumption = 10 + .75Y
Investment = 20 + .15Y
Government = 35
The size of the expenditure multiplier for this
hypothetical economy is
a. 4.
b. 10.
c. 2.
d. none of the other answers are correct.
2. Find the level of equilibrium income, given the
following values for the economy:
Consumption = 10 + .75Y
Investment = 20 + .15Y
Autonomous Taxes = 20
Government = 30
a. 180...
Consider the following national-income model. Y = AE（1） AE = C + I0 + G0（2） C...
Consider the following national-income model.
Y = AE（1）
AE = C + I0 + G0（2）
C = C0 + bY 0 < ? < 1（3）
(a)Remaining in parametric form (do not sub in parameter
values), build the equation for total spending AE (also known as
aggregate demand).
(b) Continuing in parametric form, find the RFE for equilibrium
national income Y* (also known as equilibrium national output).
(c) Using the parameter values ?0 = 25, ? = 0.75, ?0= 50, and...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- With VMI, members of the supply chain share planning, demand, forecasting, and inventory information.
- Large lots are desirable in supply chain coordination despite increasing holding costs.
- ***Convert the C++ to Python*** #include <iostream> using std::cout; using std::cin; using std::endl; int charClass; char...
- Make-or-Buy Decision Fremont Computer Company has been purchasing carrying cases for its portable computers at a...
- The following costs were incurred for the single product produced during the first year of operations...
- Non-constant growth model: Do=$2.00 required return on equity= 5% g= 9% n=1,2 g=7% n=3,4 g=3% n=5...
- . Find all x ∈ Z143 such that x2Ξ 7 (mod 143). Please explain all steps...
ADVERTISEMENT