The price of home computers rises. According to the law of supply, manufacturers will respond to this price increase by
A. keeping computer production steady
B. decreasing computer production.
C. increasing computer production.
D. halting computer production.
Ans: C. increasing computer production.
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Which of the following increases total factor productivity?
A) investment in machinery B) a harsh winter C) better access to credit D) new production procedures
When there are omitted variables in the regression, which are determinants of the dependent variable, then
A) you cannot measure the effect of the omitted variable, but the estimator of your included variable(s) is (are) unaffected. B) this has no effect on the estimator of your included variable because the other variable is not included. C) this will always bias the OLS estimator of the included variable. D) the OLS estimator is biased if the omitted variable is correlated with the included variable.
As competitors enter a monopolistically competitive industry, the incumbent firms demand curves shift
a. To the left and become less elastic b. To the right and becomes less elastic c. To the left and becomes more elastic d. To the right and becomes more elastic
If the MPC for an economy is 0.90, a $4 billion increase in taxes will ultimately cause consumption to decrease by
A. $3.6 billion. B. $40 billion. C. $36 billion. D. $4.4 billion.