1. The range of values in which we can be confident that the true regression coefficient lies within a given degree of probability is called a:
a. confidence interval.
b. logistic regression.
c. prediction interval.
d. none of the above.
2. Which of the following approaches to understanding and predicting consumer behavior depends primarily on the knowledge and experience of a firm's employees and its suppliers?
a. Direct consumer surveys.
b. Test marketing and price experiments
c. Expert opinion.
d. Analysis of historical data.
3. An approach to analyzing consumer behavior in which consumer reaction to different prices is analyzed in a laboratory situation or a test market is called:
a. focus groups.
b. price experiments.
c. non-price experiments.
d. none of the above.
4. Which of the following is true of the relationship between the marginal cost function and the average total cost function?
a. The ATC curve intersects the MC curve at minimum MC.
b. The MC curve intersects the ATC curve at minimum ATC.
c. If MC is greater than ATC, then ATC is falling.
d. If MC is less than ATC, then ATC is increasing.
5. The technique that estimates long-run costs and the minimum efficient scale by determining the scale of operation at which most firms in an industry are concentrated is called the:
a. back-of-the-envelope approach.
b. engineering estimation technique.
c. statistical cost estimation technique.
d. survivor approach.
6. The list of the major factors that create economies of scale includes all of the following except:
a. specialization and division of labor.
b. quantity discounts.
c. an increase in demand for the firm's output.
d. the use of automation devices.
7. Which of the following is likely to limit the ability of a firm to minimize production costs?
a. The firm faces limited competition.
b. Resistance by labor.
c. The fact that the firm is a nonprofit organization.
d. All of the above.
8. Which of the following statements about the beer industry is false?
a. Total employment in the industry has increased substantially as a result of increased
demand for beer.
b. Over the last 30 years, technological change has resulted in substantial economies of
scale in the industry.
c. The five largest firms in the industry control approximately 97 percent of the market.
d. The current minimum efficient scale in the industry is approximately 8 million barrels
per year.
9. You have the following demand equation for a pack of cigarettes: Q = 200 - 0.30P with the average quantity 3 packs and average price $3.00 per pack. What is the price elasticity?
a. 1.0
b. -1.0
c. -0.30
d. 0.30
10. The total sum of squares is 400 and the sum of squares errors is 100, what is the coefficient of determination?
a. 25
b. 0.75
c. 1.00
d. 0