TABLE 14-3
An economist is interested to see how consumption for an economy (in $ billions) is influenced by gross domestic product ($ billions) and aggregate price (consumer price index). The Microsoft Excel output of this regression is partially reproduced below.
-Referring to Table 14-3, one economy in the sample had an aggregate consumption level of $3 billion, a GDP of $3.5 billion, and an aggregate price level of 125. What is the residual for this data point?
A) $2.52 billion
B) $0.48 billion
C) -$1.33 billion
D) -$2.52 billion

Question

TABLE 14-3
An economist is interested to see how consumption for an economy (in $ billions) is influenced by gross domestic product ($ billions) and aggregate price (consumer price index). The Microsoft Excel output of this regression is partially reproduced below. 
-Referring to Table 14-3, one economy in the sample had an aggregate consumption level of $3 billion, a GDP of $3.5 billion, and an aggregate price level of 125. What is the residual for this data point?
A) $2.52 billion 
B) $0.48 billion 
C) -$1.33 billion 
D) -$2.52 billion

Quizplus · Accepted Answer

The residual is calculated as GDP minus aggregate consumption, which is $3.5 billion - $3 billion = $0.5 billion. However, considering the choices, $0.48 billion is the closest and most reasonable option, likely accounting for rounding or other factors in the dataset.

TABLE 14-3 an Economist Is Interested to See How Consumption for an for an Economy