Suppose a Small Island Nation Imports Sugar for Its Population

question 30

Multiple Choice

Suppose a small island nation imports sugar for its population at the world price of $1,500 per ton. The domestic market for sugar is shown below. With no subsidy, what is producer surplus?

• A)$0 per day
• B)$1,000 per day
• C)$4,000 per day
• D)$8,000 per day

---

Definitions:

Simple Linear Regression

Simple Linear Regression is a statistical method to model the relationship between a single independent variable and a dependent variable by fitting a linear equation.

Sample Correlation Coefficient

A measure that indicates the degree of linear relationship between two variables in a sample, ranging between -1 and 1, where 1 means a perfect positive correlation and -1 a perfect negative correlation.

Regression Statistic

A measure used in regression analysis to assess the relationship between variables, typically involving parameters such as coefficients that indicate the strength and direction of the relationships.

Durbin-Watson Statistic

A test statistic used to detect the presence of autocorrelation in the residuals from a regression analysis.