What Is Meant by a 'Spurious' Relationship Between Two Variables

question 21

Multiple Choice

What is meant by a 'spurious' relationship between two variables?

• A) One that is so illogical it cannot possibly be true
• B) An apparent relationship that is so curious it demands further attention
• C) A relationship that appears to be true because each variable is related to a third one
• D) One that produces a perfect negative correlation on a scatter diagram

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Definitions:

Midpoint Method

A technique used in economics for calculating elasticity by taking the average of the starting and ending prices and quantities to find a percentage change.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, reflecting the product's sensitivity to price changes.

Supply Curve

The supply curve is a graphical representation showing the relationship between the price of a good and the quantity of the good that suppliers are willing to sell.

Price Elasticity

A gauge of how sensitively the demand or supply for a product reacts to alterations in its price.