The sample average is a random variable and
A) is a single number and as a result cannot have a distribution.
B) has a probability distribution called its sampling distribution.
C) has a probability distribution called the standard normal distribution.
D) has a probability distribution that is the same as for the Y1,..., Yn i.i.d. variables.
Answer: B
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Which of the following is most likely to lead to an increase of 1% in the nominal demand for money?
A) An increase in real income of 0.5% B) A decrease in real income of 0.5% C) A decline of 1% in the price level D) An increase of 1% in the price level
Another name for the money of checking accounts is
A. certificates of deposit. B. time deposits. C. demand deposits. D. bank notes.
Markets may have difficulty providing the proper quantity of a public good because
a. individuals will tend to become free riders, and private firms will have difficulty generating enough revenue to produce an efficient quantity of the good. b. the good generally has a very large value to consumers relative to its cost of production. c. the good is one that tends to benefit a large number of people. d. the large profit involved in the production of a public good is generally too much for private firms to effectively pay out to shareholders.
Adverse selection arises when:
A. buyers and sellers with the same information about the quality of a good or the riskiness of a situation seek each other out. B. buyers and sellers have different information about the quality of a good or the riskiness of a situation. C. people behave in a riskier way because they have incomplete information. D. the wants of both parties are aligned with one another.