Firms discount future profits at the interest rate r because
A) it is the interest rate on their debt.
B) it is the same rate as for households.
C) Ricardian equivalence holds.
D) it has to equal the marginal productivity of capital in equilibrium.
B
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Refer to the figure below. If the price is $4 today and there is no change in either supply or demand, one would expect the price in the future to be:
A. greater than $6. B. $4. C. less than $4. D. greater than $4.
Quasi-experiments
A) provide a bridge between the econometric analysis of observational data sets and the statistical ideal of a true randomized controlled experiment. B) are not the same as experiments, and lessons learned from the use of the latter can therefore not be applied to them. C) most often use difference-in-difference estimators, which are quite different from OLS and instrumental variables methods studied in earlier chapters of the book. D) use the same methods as studied in earlier chapters of the book, and hence the interpretation of these methods is the same.
Hard money:
A. is the least narrow definition of money. B. includes cash. C. cannot always be used in transactions immediately, but is accessible. D. is not very liquid.
The production possibilities frontier has a:
a. curved shape. b. straight shape. c. U shape. d. frequency shape.