A Regression Analysis of the Australian Dollar Value on the Inflation

question 39

True/False

A regression analysis of the Australian dollar value on the inflation differential between the UK and Australia produced a coefficient of 0.8. Thus, for every 1% increase in the inflation differential, the Australian dollar is expected to depreciate by 0.8%.

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Definitions:

Secondary Effects

Unintended consequences of economic actions that may develop slowly over time as people react to events.

Rent Control

Government regulations that limit the amount landlords can charge for renting out a property and may also restrict the reasons for evicting tenants.

Economy Works

The systematic way in which economic activities are organized and conducted in a society to produce goods and services.

Scientist

A professional engaged in a systematic activity to acquire knowledge, often employing the scientific method in various fields.