The dummy variable trap is an example of
A) imperfect multicollinearity
B) something that is of theoretical interest only
C) perfect multicollinearity
D) something that does not happen to university or college students
Answer: C
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In a competitive market, one would expect to see
A) no advertising. B) false advertising. C) advertising only in the Sunday papers. D) minimal advertising.
GDP measures
A. the changes in the unemployment rate in a given year. B. the amount of underground activity in a nation. C. the nation's economic activity. D. the nation's economic welfare.
Suppose the opportunity cost is a constant 500 TV sets for 1 car in Canada and 1,000 TV sets for 8 cars in Mexico. Then, if both countries specialize in accordance with their comparative advantage, the production of 1,000 extra TV sets in one country and 1,000 fewer TV sets in the other would imply that the world as a whole can have
a. 2 more cars b. 6 more cars c. 8 more cars d. 125 more cars e. 500 more cars
A market failure is a situation in which
A. the market equilibrium leads to either too many or too few resources going towards producing the good or service. B. resources are being efficiently allocated, but some companies are forced to shut down. C. there is no free entry or exit into an industry. D. the government must take actions to correct the failures of the market in a particular industry.