Suppose That Reducing Inflation 3 Percentage Points Would Cost a Country

question 200

Multiple Choice

Suppose that reducing inflation 3 percentage points would cost a country 15 percent of annual output.What is this country's sacrifice ratio?

• A) 3
• B) 5
• C) 8
• D) 12

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Definitions:

Slope Coefficient

In linear regression, it represents the expected change in the dependent variable for a one-unit change in the independent variable.

Dummy Variables

Variables created to represent attributes with two or more distinct categories or levels, used in regression analysis.

Nominal Variable

A type of variable with data that can be categorized but not ranked or ordered numerically.

Regression Analysis

A set of statistical processes for estimating the relationships among variables, often to predict a dependent variable from one or more independent variables.