R² Measures ________

question 56

Multiple Choice

r² measures ________.

• A) the proportion of variation in one variable that is explained by the other
• B) the proportion of variation in Y due to the variation within each of the categories of X
• C) the proportion of error variation
• D) the proportion of variation in Y related to the variation of the categories of X

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Definitions:

Comparative Advantage

The advantage conferred on an individual or country in producing a good or service if the opportunity cost of producing the good or service is lower for that individual or country than for other producers.

Absolute Advantage

The advantage conferred on an individual or country in an activity if the individual or country can do it better than others. A country with an absolute advantage can produce more output per worker than other countries.

Ricardian Advantage

A theory in economics that suggests countries should specialize in producing and exporting goods in which they have a relative productivity advantage.

Opportunity Cost

The sacrifice of gains that could have been obtained from alternative choices when one is selected.