Suppose an Economist Collects the Following Data Between May and December

question 30

Multiple Choice

Suppose an economist collects the following data between May and December of a given year: gasoline prices rose sharply, consumer incomes remained constant, consumers purchases of fuel efficient vehicles remained constant from the previous year, the size of the population did not change, sales of gasoline decreased by 15 percent. Which of the following theories could be tested with this information?

• A) When the price of gasoline rises, gasoline purchases fall.
• B) When consumer incomes rise, gasoline purchases rise.
• C) When the population increases, purchases of fuel efficient vehicles increase.
• D) No economic theory could be tested with this information.

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Definitions:

ADR

Alternative Dispute Resolution, a range of procedures such as mediation and arbitration for resolving disputes without the need for litigation.

Litigation

The process of taking legal action or resolving disputes through the court system.

United Nations Convention

An international agreement formed under the auspices of the United Nations, addressing various global issues through legally binding treaties or protocols.

ADR

stands for Alternative Dispute Resolution, which refers to dispute resolution processes and techniques that act as a means for disagreeing parties to come to an agreement short of litigation.