An Economist Is Interested to See How Consumption for an Economy

question 95

Multiple Choice

An economist is interested to see how consumption for an economy (in $ billions) is influenced by gross domestic product ($ billions) and aggregate price (consumer price index) . Annual data
From 30 years were collected. Which of the following would be the most appropriate analysis to
Perform?

• A) Simple linear regression.
• B) Multiple linear regression.
• C) Exponential smoothing.
• D) Autoregressive modeling for trend fitting and forecasting

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Definitions:

Preferred Stock

A class of shares which typically provides a fixed dividend and has priority over common stock in the distribution of assets during liquidation.

Shares

Shares representing ownership rights in a corporation or financial asset, guaranteeing a fair share of profits through dividends, if declared.

Par Common Stock

This represents the nominal or face value assigned to common stock shares, which is the minimal amount shareholders must contribute and is not necessarily related to the market value.

Market Price

The current value at which an asset or service can be bought or sold in a transaction between willing parties.