Assume That the Consumption Function Is Given by C =

question 23

Multiple Choice

Assume that the consumption function is given by C = 150 + 0.85(Y - T) and the tax function is given by T = t + t Y. If 0 1
T increases by 1 unit, then consumption:
0

• A)decreases by 0.85 units.
• B)decreases by 0.15 units.
• C)increases by 0.15 units.D.increases by 0.85 units.

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Definitions:

Regression Line

A straight line that best fits the data points on a scatter plot, showing the relationship between the independent and dependent variables.

Annual Rainfall

The total amount of precipitation, measured in units of length, that falls in a specific area over the course of one year.

Shoreline Erosion

The process by which coastal land is worn away by natural forces such as wave action, currents, or tidal movements.

Least Squares Regression

A statistical method used to fit a regression line through a set of points in such a way that minimizes the sum of the squares of the vertical distances of the points from the line.