Figure 2-21
-Refer to Figure 2-21. Your friend John created the graph above to illustrate that snowstorms are caused by more snowblowers being sold. You inform him that his interpretation is incorrect due to
A)omitted variable bias.
B)reverse causality.
C)slope mismatch.
D)shifting versus moving along a curve.

Question

Figure 2-21 
-Refer to Figure 2-21. Your friend John created the graph above to illustrate that snowstorms are caused by more snowblowers being sold. You inform him that his interpretation is incorrect due to
A)omitted variable bias. 
B)reverse causality. 
C)slope mismatch. 
D)shifting versus moving along a curve.

Quizplus · Accepted Answer

The graph shows a correlation between the number of snowblowers sold and the amount of snowfall, but it does not demonstrate causality. It is possible that the increased snowfall is actually causing an increase in snowblower sales due to demand. This is an example of reverse causality.

Figure 2-21 -Refer to Figure 2-21. Your Friend John Created the Graph