When estimating a cubic short-run production function Q = AL3 + BL2 using linear regression analysis, you must
A. convert the right-hand-side variables to logarithms.
B. suppress the intercept term (regress through the origin).
C. transform the equation into linear form by defining L3 and L2 as L3 and L2, respectively.
D. both a and b
E. both b and c
Answer: D
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An appreciation of the U.S. dollar relative to the Japanese yen causes
A) a lower dollar-price of Japanese goods which induces the U.S. to increase their purchasing of Japanese goods. B) the quantity demanded of U.S. dollars to increase because the Japanese want to buy more U.S. goods. C) the Japanese to buy more U.S. goods, causing the dollars to appreciate further. D) the U.S. to buy less Japanese goods, causing the U.S. to depreciate.
Which of the following was not an objection raised by opponents of the Patient Protection and Affordable Care Act?
A. The revenue generated by the new taxes in the PPACA would be insufficient to cover costs of the program. B. The PPACA moves the United States closer to creating a national health insurance system with nonprice rationing of health care. C. The subsidies would lead to higher prices and increased consumption of health care. D. The percentage of health care spending coming directly out of consumers' pockets would increase.
Suppose the required reserve ratio is 20%. A $40 million cash deposit will, at most, allow an expansion of the money supply to
A. $20 million. B. $80 million. C. $200 million. D. $800 million.
The CPI is biased because it
A) takes into account the changes in product quality. B) takes into account the changes in technology. C) does not always take into account the changes in product quality. D) accurately measures the cost of living but not the cost of producing. E) does not include services.