The Income of an Individual in Budopia Depends on His

question 9

Multiple Choice

The income of an individual in Budopia depends on his ethnicity and several other factors which can be measured quantitatively. If there are 5 ethnic groups in Budopia, how many dummy variables should be included in the regression equation for income determination in Budopia?

• A)1
• B)5
• C)6
• D)4

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Definitions:

Trading Blocs

Groups of countries that have formed international agreements to enhance trade among themselves through the reduction of tariffs and common regulations.

West European

Pertaining to the countries located in the western part of Europe, often characterized by shared historical, cultural, and political experiences.

North American

Of or relating to the continent that includes Canada, the United States, Mexico, and the countries of Central America.

Industrial Revolution

A period of major industrialization that took place during the late 1700s and early 1800s, transforming agriculture-based societies into industrialized and urban ones.