In the circular-flow diagram, firms produce
a. goods and services using factors of production.
b. output using inputs.
c. factors of production using goods and services.
d. Both (a) and (b) are correct.
d
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The federal income tax on wages is the largest source of revenue for the federal government
Indicate whether the statement is true or false
The long run refers to a time period
A) long enough for a firm to pay all of its creditors in full. B) long enough for a firm to change the use of its variable inputs. C) long enough for a firm to vary all of its inputs, to adopt new technology, and change the size of its physical plant. D) during which a firm is able to purchase all of its inputs, including its plant and equipment.
Historically, the largest U.S. federal budget deficits as a percentage of GDP since the beginning of the 20th century occurred during
A) the Great Depression. B) World War I and World War II. C) 1970-1997. D) 2007-2009.
Assume that you have used the OLS estimator in the cointegrating regression and test the residual for a unit root using an ADF test. The resulting ADF test statistic has a
A) normal distribution in large samples. B) non-normal distribution which requires ADF critical values for inference. C) non-normal distribution which requires EG-ADF critical values for inference. D) normal distribution when HAC standard errors are used.