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Statistical methods are considered to be superior techniques of demand estimation because:
a. The element of subjectivity in this method is minimum,
b. Methods of estimation is scientific,
c. Estimation is based on the theoretical relationship between the dependents and independents variable ,
d. Estimates are relatively more reliable and
e. Estimation involves smaller cost.
Problem: (a) Why is an error term added to a regression and explain its importance in the OLS procedure? (b) Suppose we have a linear equation with a constant term, one expl
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who propounded the pure international theory of trade?
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