Investment is important to the short run health of the economy because it
a) is the largest component of GDP
b) is countercyclical, and thus stabilizing
c) is highly volatile, and thus contributes largely to business cycles
d) can be easily controlled by government
e) is highly predictable, and thus useful for forecasting
c) is highly volatile, and thus contributes largely to business cycles
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A lender of last resort
A) makes loans when no one else will. B) makes loans without regard for risk. C) is a firm that is forced to make loans for its own survival. D) Both A and B. E) None of the above.
Sample selection bias
A) occurs when a selection process influences the availability of data and that process is related to the dependent variable. B) is only important for finite sample results. C) results in the OLS estimator being biased, although it is still consistent. D) is more important for nonlinear least squares estimation than for OLS.
A firm facing a downward-sloping demand curve sells 50 units of output at $10 each. The firm's marginal revenue is
a. $500 b. more than $10 but less than $500 c. $10 d. less than $10 e. zero
The bulk of the M1 money supply is made up of
a. silver dollars and gold bars. b. check able deposits. c. currency and travelers checks. d. money market funds.