d. for a one unit increase in price, quantity demanded would decline by 2.1 percent e. none of the above

17.

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

QD = 1.6 P 1.5 Y.2 The coefficient of Y (i.e., .2) indicates that (all other things being held constant):

a. for a one percent increase in disposable income, quantity demanded would increase by .2 percent

b. for a one unit increase in disposable income, quantity demanded would increase by .2 units c. for a one percent increase in disposable income quantity demanded would increase by .2 units

d. for a one unit increase in disposable income, quantity demanded would increase by .2 percent

e. none of the above 18.

One shortcoming of the use of _____________ in demand analysis is that the participants are generally aware that their actions are being observed and hence they may seek to act in a manner somewhat different than normal. a. market experiments

b. consumer clinics c. statistical (econometric) methods d. a and b e. none of the above

19.

The constant or intercept term in a statistical demand study represents the quantity demanded when all independent variables are equal to: a. 1.0

b. their minimum values c. their average values d. 0.0 e. none of the above