DRAG DROP

Complete the table inputting the relevant effect for each of the scenarios listed.

Select and Place:

A commercial airline uses its database to develop the following regression model to predict the cost of a flight Y (in dollars) by number of passengers:

Y = 1,570 + 40.7x

Which of the following statements is correct in relation to the airline?

A. The cost of a flight will increase by $40.7 when an additional passenger is added to the flight.

B. The regression model makes accurate predictions for this commercial airline, therefore it will provide good forecasts for other commercial airlines.

C. The positive intercept in the model indicates a positive relationship between the cost of a flight and the number of passengers.

D. If each pair of data points is plotted on a graph with Y on the vertical axis and X on the horizontal axis, there will be a downward sloping line.

Which of the following is correct in relation to businesses?

In order to maximize shareholder wealth, the primary objective of a business can be reflected in:

(1)

higher investment

(2)

higher sales revenue

(3)

higher share prices

(4)

higher dividend payments.

A.

(1) and (3)

B.

(3) and (4)

C.

(1) and (2)

D.

(2) and (4)

Which of the following statements defines a diseconomy of scale?

A. A reduction in the unit average cost caused by increasing the scale of production in the long run.

B. An increase in the unit average cost caused by increasing the scale of production in the long run.

C. An increase in the unit average cost caused by decreasing the scale of production in the long run.

D. A reduction in the unit average cost caused by decreasing the scale of production in the long run.

The government of Country Z imposes a tariff on all imports of coal from other countries. Which THREE of the following are possible effects of this decision in Country Z? (Choose three.)

A. The cost of living will fall.

B. Employment in the coal industry will increase.

C. The balance of payment will improve.

D. Government's revenue will improve.

E. Coal producers will adopt new technologies to improve efficiency.

F. More resources will be allocated to alternative energy sources.

Which of the following are the likely consequences, in the domestic economy of a country, of an increase in interest rates?

1.

A rise in demand for capital goods.

2.

A fall in demand for consumer goods.

3.

A fall in demand for housing.

4.

A rise in the exchange rate.

A. 2, 3 and 4

B. 1, 3 and 4

C. 1, 2 and 4

D. 1, 2 and 3

Which of the following will result in an increase in demand for domestic currency?

A. An increase in exports.

B. A rise in imports.

C. More domestic companies invest abroad.

D. Outward financial flows.

FILL BLANK

A business analyst has computed a trend regression for the sales of company X. The following table reports the ratios between the actual quarterly sales of company X and the calculated trend, for a period of four years.

What is the seasonal component in the fourth quarter? Give your answer to three decimal places.

A. 0.563

FILL BLANK

A magazine currently has a circulation of 500,000 copies per year at a price of $5 per copy. Following a market survey it has been suggested that the price of each copy should be reduced to $4.50. It is expected this will lead to an increase in

circulation of 25,000 copies per year.

What is the price elasticity of demand of the magazine?

A. +0.5

FILL BLANK

A wireless phone manufacturer currently sells 2,000 units per quarter at a price of $400. The estimated price elasticity of demand is -2.5.

The manufacturer is considering an increase in the price to $440.

What will this raise (+) or reduce (-) total revenue by? Give your answer in whole numbers.

A. reduce - 139000