There Is Only One Gas Station Within Hundreds of Miles

question 54

Multiple Choice

There is only one gas station within hundreds of miles. The owner finds that when she charges $3 a gallon, she sells 199 gallons a day, and when she charges $2.99 a gallon, she sells 200 gallons a day. The marginal revenue of the 200th gallon of gas is

• A) $.01.
• B) $1.
• C) $2.99.
• D) $3.
• E) $600.

Recognize when to use indicator variables in multiple regression models.

Identify the appropriate number of indicator variables for nominal variables with various categories.

Interpret the role and effect of indicator variables in regression analysis and model prediction.

Apply indicator variables in modeling differences among groups in multiple regression analyses.

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Definitions:

Unconscious Processing

Mental processes that occur without conscious awareness or intention, influencing perceptions, thoughts, and behaviors.

Confirmation Bias

The tendency to search for, interpret, and remember information in a way that confirms one's preconceptions, leading to statistical errors.

System I

A term often used to describe intuitive, fast, and automatic thinking processes, as opposed to more deliberate and analytical decision-making.

System II

A term often used to describe slow, deliberate, and analytical thought processes in dual-process theories of cognition.