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b. market experimentation c. a statistical demand analysis d. the consumer clinic e. the barometric method


14.


Demand functions in the multiplicative form are most common for all of the following reasons except:


a. elasticities are constant over a range of data b. ease of estimation c. exponents of parameters are the elasticities of those variables d. marginal impact of a unit change in an individual variable is constant e. c and d


15.


The Identification Problem in the development of a demand function is a result of: a. the variance of the demand elasticity b. the consistency of quantity demanded at any given point c. the negative slope of the demand function d. the simultaneous relationship between the demand and supply functions e. none of the above


16.


Consider the following linear demand function where QD = quantity demanded, P = selling price, and Y = disposable income:


QD = 36 2.1P + .24Y


The coefficient of P (i.e., 2.1) indicates that (all other things being held constant): a. for a one percent increase in price, quantity demanded would decline by 2.1 percent b. for a one unit increase in price, quantity demanded would decline by 2.1 units c. for a one percent increase in price, quantity demanded would decline by 2.1 units


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