User Account

All Pages

Interpret this regression and how would you interpret r 2

Assignment Help Microeconomics
Reference no: EM13882168

The relationship between nominal exchange rate and relative prices. From the annual observations from 1980 to 1994, the following regression results were obtained, where Y = exchange rate of the German mark to the U.S. dollar (GM/$) and X = ratio of the U.S. consumer price index to the German consumer price index; that is, X represents the relative prices in the two countries:

Yˆt = 6.682 - 4.318 Xt r 2 = 0.528 se = (1.22)(1.333)

a. Interpret this regression. How would you interpret r 2 ?

b. Does the negative value of Xt make economic sense? What is the un- derlying economic theory?

c. Suppose we were to rede?ne X as the ratio of German CPI to the U.S. CPI. Would that change the sign of X? And why?

Reference no: EM13882168

Questions Cloud

Explain the difference between attitudes and behavior : Explain the difference between attitudes and behavior
Present a multi-disciplinary case-method : Determine whether each manufacturing overhead expense is variable or fixed. It has been determined that all the manufacturing overhead costs are fixed, although salary of part-time workers and utilities can be variable or mixed expenses as well.
What is the public health policy regarding tobacco control : How do tobacco control regulations impact individual health care rights? What is the public health policy regarding tobacco control? What is the role of the state and Federal Government in policy making
Describe how listening causes interpersonal conflict : Provide an example of how improved listening and communication could assist with outcomes. Describe how listening causes interpersonal conflict and Give three reasons people don't listen and provide at least one "solution" to each listening problem
Interpret this regression and how would you interpret r 2 : Suppose we were to rede?ne X as the ratio of German CPI to the U.S. CPI. Would that change the sign of X? And why?
What will be the expected return of your portfolio : You are an investor in common stock, and you currently hold a well-diversified portfolio that has an expected return of 10%, a beta of 1.2, and a total value of $12,000. You plan to increase your portfolio by buying 1,000 shares of X at $15 a share. ..
A companys preferred stock pays fixed dividend : A company’s preferred stock pays a fixed dividend of $1.4 per share forever. The market uses a discount rate of 7%. What is the price of this preferred stock? The risk free rate in the economy is 1.00% and the market risk premium is 5.00%. If an anal..
Define and discuss framing : For each of the two selected you will write 2-3 paragraphs analyzing the emotional issues in each one. Define and discuss framing. What strategy would you employ or suggest be used in each of your selected case study. What role could an apology..
Determine which strategies are the best to implement : The manager has a maximum of $50 per employee to spend on the permanent implementation of as many of the strategies. Determine which strategies are the best to implement.

Reviews

Write a Review

Microeconomics Questions & Answers

  What is the marginal revenue in each submarket

Does "Hungry Jack" have a dominant strategy and does "Aunt Jemima" have a dominant strategy - What is the marginal revenue in each submarket?

  The relationships between macro variables of inflation

1. Using the relationships between macro variables of Inflation, Income and wage rate, technology, unemployment, and interest rates related to Comcast, develop a short-term (about one year) outlook for Comcast.

  What market structure will katrina candies operate

What market structure will Katrina's Candies operate if the above condition prevails?

  Compute the marginal profit function

Compute the marginal profit function and what is the profit maximizing price, what is the market demand function and what is each firm's supply function?

  Manning only consumes goods x and y

Manning only consumes goods X and Y. His marginal utility from consuming good X is 4, and his marginal utility from consuming good Y is 5. If the price of X is $6, the price of Y is $8, and Manning's income is $48, how much of good X will he purchase..

  Which re- quire advanced professional training

What can you ?nd out about the trend to outsource high-end ser- vices like these? Is it on the up tick? Is it expanding to include other services which re- quire advanced professional training?

  The level of real aggregate demand for output in a macro

Suppose the level of real aggregate demand for output in a macro economy is a negative function of the expected real interest rate- the nominal interest rate minus the expected inflation rate. Suppose also that the monetary authorities are setting th..

  Respond to the scenario with your thoughts

Respond to the scenario with your thoughts, ideas, and comments. Be substantive and clear, and use research to reinforce your ideas.

  Suppose the economy is initially in long-run equilibrium

Suppose the economy is initially in long-run equilibrium and the U.S. stock market has a prolonged decrease in shareholder value. Use the AD–AS model to predict short-run changes to real GDP and the aggregate price level. Using the AD–AS model explai..

  Applying the modified equation affects equilibrium.

Consider the russian ruble. In recent months, the value of the ruble has fallen considerably. The typical explanation for this is that political events, in the Ukraine, in particular, have made the future value of the currency difficult to predict. S..

  Two projects-decide which alternative

Given that two projects have the same rate of return of 12 percent each. The incremental rate of return is 15 percent. If MARR is 15 percent, decide which alternative should be chosen.

  Draw the consumers demand curve for griffie of type

Fix the prices of types .3 and .7 at 3 and 4, respectively. Draw this consumer's demand curve for griffie of type .5 as a function of the price of this type of griffie.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd