When Estimating a Cubic Short-Run Production Function $Q = A I ^ { 3 } + B L ^ { 2 }$

question 10

Multiple Choice

When estimating a cubic short-run production function $Q = A I ^ { 3 } + B L ^ { 2 }$ using linear regression analysis, you must

• A) transform the equation into linear form by defining L3 and L2 as L³ and L², respectively.
• B) suppress the intercept term (regress through the origin).
• C) convert to logarithms.
• D) both a and b
• E) both b and c

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Definitions:

Lowest Terms

The simplest form of a fraction, where the numerator and the denominator are reduced to their smallest possible values.

Mixed Numbers

Quantities that combine a whole number with a fraction less than one.

Lowest Terms

The simplest form of a fraction, with both the numerator and denominator reduced to their smallest possible numbers.

Fractions

A mathematical expression representing a part of a whole, usually in the form of a numerator and a denominator.