An auxiliary regression refers to a regression that is used:
A. when the dependent variables are qualitative in nature.
B. when the independent variables are qualitative in nature.
C. to compute a test statistic but whose coefficients are not of direct interest.
D. to compute coefficients which are of direct interest in the analysis.
Answer: C
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In a market open to international trade, at the world price the quantity demanded is 150 and quantity supplied is 200. This country will
A) export 50 units. B) import 50 units. C) export 200 units. D) import 150 units.
During the 1990s, Japan's economy experienced
A) a tripling of values in the stock market. B) negligible inflation and unemployment rates. C) falling short-term interest rates. D) All of the above.
Which of the following statements is not true in a perfectly competitive industry in long-run equilibrium?
A. A profit-maximizing firm may produce any output level at which P < LRAC. B. Every firm produces at an output level at which MC = LRAC. C. There is no entry or exit from the industry. D. No firm earns an economic profit.
A possible explanation for the persistence of the U.S. federal budget deficits is that: a. it is easier politically to increase government spending than to decrease taxes. b. it is easier politically to decrease government spending than to decrease taxes. c. it is easier politically to increase government spending than to increase taxes. d. the economy naturally tends toward recessions
e. the economy naturally tends toward full employment.