An Economist Wishes to Build a Model to Explain the Relationship

question 48

Essay

An economist wishes to build a model to explain the relationship between the number of diamonds purchased every year and the average income of consumers in that year. Which variable should be the dependent variable and which should be the independent variable? All else equal, do you expect this relationship to be positive or negative? Explain.

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Definitions:

Passive Dependence

A behavioral pattern where individuals excessively rely on others for support, decision-making, and taking action, often to the detriment of their independence.

Inferiority Complex

A psychological condition in which an individual feels a lack of worth and doubts their abilities, often unfairly comparing themselves to others.

Freudian Psychologist

A psychologist who follows the theories of Sigmund Freud, focusing on unconscious processes, childhood experiences, and psychosexual development.

Strong Superego

A strong superego refers to an aspect of a person's personality that acts as a moralizing force, often being critical and enforcing the moral standards learned from parents and society.