When Estimating a Demand Function for a Good Where Quantity

question 54

Multiple Choice

When estimating a demand function for a good where quantity demanded is a linear function of the price, you should

• A)not include an intercept because the price of the good is never zero.
• B)use a one-sided alternative hypothesis to check the influence of price on quantity.
• C)use a two-sided alternative hypothesis to check the influence of price on quantity.
• D)reject the idea that price determines demand unless the coefficient is at least 1.96.

---

Definitions:

Pressure Wave

A type of wave mechanism that occurs when a fluid or gas changes velocity, often seen in the circulatory system as a pulse.

Blood Volume

The total amount of blood circulating within an individual's vascular system.

Ventricular Systole

The phase of the heartbeat when the ventricles contract, pumping blood out of the heart and into the arteries.

Pulmonary Trunk

The main vessel transporting deoxygenated blood from the right ventricle of the heart to the lungs.