William Used a Sample of 68 Large U

question 20

Multiple Choice

William used a sample of 68 large U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income (median annual income per capita, in dollars) . His estimated regression equation was Crime = 428 + 0.050 Income. We can conclude that:

• A)the slope is small so Income has no effect on Crime.
• B)crime seems to create additional income in a city.
• C)wealthy individuals tend to commit more crimes, on average.
• D)the intercept is irrelevant since zero median income is impossible in a large city.

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Definitions:

English Auction

A type of auction in which the price starts low and is progressively bid upwards, with the highest bid at the end winning the item.

Rational Self-Interest

The principle that individuals tend to make decisions that maximize their own utility or benefit.

Collude

To conspire or work together secretly, especially in order to cheat or deceive others.

Dutch Auction

A type of auction where the auctioneer starts with a high asking price which is lowered until some participant is willing to accept the auctioneer’s price, or a predetermined minimum price is reached.