Accounting profit is greater than or equal to economic profit
a. True
b. False
Indicate whether the statement is true or false
True
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Unbiasedness and small variance are desirable properties of estimators
However, you can imagine situations where a trade-off exists between the two: one estimator may be have a small bias but a much smaller variance than another, unbiased estimator. The concept of "mean square error" estimator combines the two concepts. Let be an estimator of ?. Then the mean square error (MSE) is defined as follows: MSE( ) = E( – ?)2. Prove that MSE( ) = bias2 + var( ). (Hint: subtract and add in E( ) in E( – ?)2.) What will be an ideal response?
The marginal productivity principle says that a profit-maximizing firm should
a. hire capital until its marginal product is zero. b. hire labor until another worker costs more to hire than he can earn for the firm. c. hire the quantities of capital and of labor at which their marginal products are equal. d. hire capital until its marginal product is negative.
SOEs refer to China's rapidly growing service sector
a. True b. False
You have noticed that there is a persistent shortage of teachers in an inner-city school district in your state. Based on this observation, you suspect that:
A. the demand for teachers in the inner-city school district is too low. B. the wage for teachers in that district is higher than the wage in other districts. C. there is an excess supply of teachers in other districts. D. the wage for teachers in that district is lower than the equilibrium wage.