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The least square method is based on the assumption that the past rate of change of the variable under study will continue in the future. It is a mathematical procedure for fitting a line to a set of observed data points in such a manner that the sum of the squared differences between the calculated and observed value is minimized. This techniques is used to find a trend line which best it the available data. This trend is then used to project dependant variable in the future. This method is very popular because it is simple and in expensive.
If at point A sacks of rice is 205 and sacks of corn is 0. What is the decrease in rice production?
Draw a Production Possibilities Frontier with consumer goods on the vertical axis and capital goods on the horizontal axis. Show how the PPF will shift if the production of capita
At what point is the Fed likely to raise interest rates for the first time? How large are the first couple of hikes likely to be? (hints: conditional on unemployment or gdp growth
A trend line can be fitted through a series graphically. Old values of sales for different areas are plotted on a graph and a free hand curve is drawn passing through as many point
What are the three approaches to measuring GDP? The three approaches are: a) The production approach, b) The spending approach and c) The income approach.
Utility-Expenditure Duality: Consider the minimisation of the expenditures necessary to achieve a specified utility level. The solution for qi yields the compensated demand f
Diversification - Assume that a firm has a choice of selling air conditioners, heaters, or both of them. - The probability of it being hot or cold is 5%. - The firm woul
CONSUMER CHOICE INVOLVING RISK: The traditional theory of consumer behaviour does not include an analysis of uncertain situation. Von Neumann and Morgenstern showed that under
how do you create a combined ppc consisting of three people
Suppose that a firm’s production function is given by Q=30L-3L2, where L is labor input and Q is the output. a) Derive and draw the firm’s demand for labor while the firm’s produ
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