Experimental approach to regression analysis

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Q1. The simple IS-LM model predicts which cutting the government's budget deficit will reduce output in the short-run. However, when extended to incorporate the effects of expectations, the model suggests which cutting the budget deficit may boost output, even in the short run. Discuss these propositions with the help of appropriately labeled diagrams.

Q2. Describe the benefits and risks entailed with an experimental approach to regression analysis.

Q3. Calculate the cost elasticity of demand for coffee when the cost decreases from R3.10 to R2.90. Interpret the elasticity calculated.

Reference no: EM139132

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