Which Estimated Multiple Regression Contains an Interaction Term?
A) $\hat { y } = 47 - 12 x _ { 1 } + 8 x _ { 1 } x _ { 2 } - 5 x _ { 2 }$

question 78

Multiple Choice

Which estimated multiple regression contains an interaction term?

• A) \(\hat { y } = 47 - 12 x _ { 1 } + 8 x _ { 1 } x _ { 2 } - 5 x _ { 2 }\) .
• B) \(\hat { y } = 47 - 12 x _ { 1 } + 8 x _ { 1 } ^ { 2 } - 5 x _ { 2 } + 25 x _ { 2 } ^ { 2 }\) .
• C) \(\hat { y } = 47 - 12 x _ { 1 } ^ { 2 } + 5 x _ { 2 } ^ { 2 }\)

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Definitions:

Externalities

Economic side effects or consequences that affect uninvolved third parties, which can be either positive or negative.

External Benefits

Positive effects of an economic transaction experienced by people or entities not directly involved in the transaction.

External Costs

Costs that are not borne by the producer or consumer but by third parties or society at large, such as pollution or resource depletion.

External Benefit

A positive effect on a party who did not choose to incur that benefit, often associated with public goods or services.