In the Method of Least Squares, Each Single Measure of Closeness

question 169

True/False

In the method of least squares, each single measure of closeness is first squared. Squaring the deviations avoids problems caused by a mix of positive and negative numbers.

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Definitions:

Doubled Income

A situation where an individual's or entity's income increases to twice its initial amount.

Homothetic Preferences

Consumer preferences where if a bundle of goods is preferred to another, then any scaled up or down version of the bundle is also preferred based on the proportion of goods, maintaining consumption patterns.

Prices Double

A situation where the prices of goods or services increase to twice their original amount.

Quasilinear Preferences

Consumer preferences where the utility function is linear in one of the goods, indicating constant marginal utility for that good.