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AndrewKraus AndrewKraus
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4 years ago
It has been observed in country X that with an increase in college enrollment over a period of six years, the demand for televisions has also increased. Would it be right to conclude that the increase in college enrollment has caused the increase in demand for televisions? Why or why not?
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Microeconomics


Edition: 1st
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SimplemanSimpleman
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4 years ago
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The error in drawing such a conclusion is that the increase in both the variables may represent a correlation and not necessarily a causal relationship. Although both the variables move together, it would be wrong to conclude that an increase in college enrollment is causing an increase in the demand for televisions. There may be other omitted variables such as changes in the per capita income in country X, or changes in the price of satellite television connection over the period of six years.
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I'll share this with my friends, thank you for being there
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