Weighted least squares estimation is used only when _____.
A. the dependent variable in a regression model is binary
B. the independent variables in a regression model are correlated
C. the error term in a regression model has a constant variance
D. the functional form of the error variances is known
Answer: D
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The three possible sources of government funding include
A) explicit fees, taxes, and borrowing. B) international income, personal income taxes, and export taxes. C) foreign aid, revenues, and implicit fees. D) None of the above are correct.
An inflationary gap occurs when
A) aggregate demand falls, but other things remain constant. B) short-run aggregate supply falls, but other things remain constant. C) the short-run equilibrium level of real GDP is greater than long-run aggregate supply. D) the short-run equilibrium level of real GDP is less than long-run aggregate supply.
Economists refer to pricing the same good at two or more different prices to two or more different consumers as
a. price differentiation b. price discrimination c. price fixing d. price collusion e. unfair pricing
The reason that antitrust laws exist and are enforced is because most economists and politicians believe that
a. every industry should be perfectly competitive b. monopolies do not maximize shareholder value in the long run c. the price and quantity combinations delivered in a perfectly competitive market are both socially desirable and most efficient d. monopolies use their market power to create economies of scale e. small firms are the backbone of American society