The Fed buys $20,000 of government securities. The desired reserve ratio is 5 percent and the currency drain ratio is zero. What will be the change in the quantity of money?
A) $400,000 B) $20,000 C) $19,000 D) $5,000 E) $399,980
A
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Suppose you purchased 100 shares of stock in 2010 for $25 a share and you sell them today for $50 a share. If the capital gains tax is 28 percent, your tax liability is
A) $70. B) $700. C) $2500. D) indeterminate without knowing the inflation rate.
An economic model is
a. a concrete representation of reality b. as close to reality as possible c. too abstract to be useful when assumptions are involved d. unrelated to reality e. an abstract representation of reality
Which of the following statements is true?
A. Fixed effects estimation is not suitable when the unobserved cluster effect is correlated with one or more explanatory variables. B. Fixed effects approach is not applicable if the key explanatory variables change only at the level of the cluster. C. The ordinary least squares standard errors are incorrect when there is cluster effect. D. Random effects estimation can be applied to a cluster sample only if the unobserved cluster effect is correlated with one or more explanatory variables.
Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced growth, we know that
A) S/NA = (? + gA + gN)K/NA. B) S/NA = (gA + gN)K/NA. C) I/NA = (?)K/NA. D) I = ?K. E) none of the above