Regression to the mean refers to the phenomenon in which unusual events are:
A. likely to be followed by events that are even more unusual.
B. occurring on a regular basis.
C. likely to be followed by events that are more normal.
D. unlikely to ever occur in the first place.
Answer: C
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The interest rate effect operates through
A) labor supply. B) government spending levels. C) the purchasing power of individuals' checking accounts. D) credit markets by changing borrowing costs.
How did Adam Smith explain the cause of the wealth of nations?
A) The growth of the middle class B) The growth in the average level of prices C) The growth of the division of labor D) People's unending urge to consume
Explain how GDP is measured according to the expenditure and income approaches
What will be an ideal response?
As wealth increases in the economy, we would expect to observe
A) bond prices and interest rates both rise. B) bond prices and interest rates both fall. C) bond prices rise and interest rates fall. D) bond prices fall and interest rates rise.