A Midwife Conducted a Bayesian Analysis of Stork Numbers and Declining

question 11

Multiple Choice

A midwife conducted a Bayesian analysis of stork numbers and declining birth rates. She calculated a Bayes factor of 1. Should she use stork numbers to predict birth rates?

• A) No, a Bayes factor of 1 suggests that although declining stork numbers appear to coincide with declining birth rates it is not 'worth mentioning' and other factors may be at work.
• B) Yes, a Bayes factor of 1 suggests that it is worth trying to increase stork numbers in order to increase the birth rate.
• C) No, a Bayes factor of 1 suggests that the data is corrupted.
• D) Yes, a Bayes factor of 1 suggests that it is worth heavily investing in reducing stork numbers in order to reduce the birth rate.

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Definitions:

Producer Surplus

The difference between the actual amount producers receive for a good and the minimum amount they would be willing to accept.

Firm

A business enterprise or establishment engaged in commercial, industrial, or professional activities.

Normal Good

A type of good for which demand increases when consumer income rises, and falls when consumer income decreases.

Demand Shift

A change in the quantity demanded at every price point, often caused by factors like consumer preferences, income, and price of related goods.