A the Identification Problem Relates to the Difficulty Encountered in Properly

question 43

Short Answer

A. The identification problem relates to the difficulty encountered in properly isolating dependent variables that influence a given independent variable.
B. To accurately model the demand function for a given product, the demand effects of all relevant dependent variables must be incorporated.
C. Solving the identification problem is made easier by the fact that many factors influence both demand and supply.
D. Accurate demand estimation requires consideration of all relevant independent variables and use of a theoretically appropriate empirical model.
E. The process of accurately modeling the link between dependent Y variables and independent X variables is easier for static as opposed to dynamic demand relations.

---

Definitions:

Arabic Numbers

Arabic numbers are the ten digits (0, 1, 2, 3, 4, 5, 6, 7, 8, 9) used around the world today for denoting quantities.

Geographic Location

The specific physical place where something exists, characterized by coordinates like latitude and longitude, or a descriptive address or landmark.

Place Division

An organizational method that categorizes information based on geographical location or placement.

Parallelism

The use of components in sentences that are grammatically the same or similar in their construction, sound, meaning, or meter.