For Case II, in What Range Must the "International" Price

question 87

Multiple Choice

For case II, in what range must the "international" price of wheat fall? i.e. if North and South Dakota trade only with each other, what is the range of prices possible?

• A)Between 1 bushel of wheat = 4/3 bottles of beer and 1 bushel of wheat = 2 bottles of beer
• B)Between 1 bushel of wheat = 3/4 bottles of beer and 1 bushel of wheat = 2 bottles of beer
• C)Between 1 bushel of wheat = 3/4 bottles of beer and 1 bushel of wheat = ½ bottles of beer
• D)None of the above

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Definitions:

Quantity Minimized

Refers to the outcome of an optimization problem where the goal is to find the smallest possible value of a certain quantity.

Multiple Regression Model

A statistical technique that models the relationship between a dependent variable and multiple independent variables by fitting a linear equation to observed data.

Regression Slope Coefficients

The estimates that measure the relationship between the dependent variable and each independent variable in regression analysis.

Y-intercept

The point where a line, curve, or surface intersects the y-axis of a coordinate system.