Suppose an increase in demand causes the price to increase from $2 to $4 and the quantity to increase from 1,000 to 1,800. Using the midpoint method, the elasticity of supply equals
A) 0.86.
B) 1.17.
C) 2.74.
D) 0.68.
E) None of the above answers is correct.
A
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Government statisticians adjust GDP figures to include estimates of
A) the value of homemaking (work done within the home). B) the underground economy. C) child-rearing services provided by stay-at-home parents. D) the costs of pollution to society.
In 1971 money market mutual funds were introduced as an alternative to
A) commercial paper. B) Treasury bills. C) repurchase agreements. D) bank deposits.
If, in addition to the least squares assumptions made in the previous chapter on the simple regression model, the errors are homoskedastic, then the OLS estimator is
A) identical to the TSLS estimator. B) BLUE. C) inconsistent. D) different from the OLS estimator in the presence of heteroskedasticity.
What is the underground economy?
(A) Costs of such things as personal safety, vacations, and sick pay. (B) The goods and services people make or do themselves. (C) The amount spent for environmental cleanup and similar products. (D) Products and income that are not reported as income to the government.