What is the "omitted variable" problem in determining cause and effect?
A) It is a problem that arises when an economic variable that affects other variables is omitted from an analysis and its omission leads to false conclusions about cause and effect.
B) It is a problem that arises when a significant variable is not given enough weight in an economic experiment leading to skewed conclusions about cause and effect.
C) It is a problem that arises when an insignificant economic variable that should have been omitted is included in an economic experiment leading to false conclusions about cause and effect.
D) It is a problem that arises when an insignificant variable is given too much weight in an economic analysis leading to skewed conclusions about cause and effect.
A
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The dividend earned by a domestic resident on a stock owned in a foreign company is an example of a(n) ________
A) import by the domestic resident B) factor payment received from foreigners C) transfer payment received from foreigners D) export by the domestic resident
Which of the following is not a function of government?
a. promotion of competition b. stabilization to achieve the macroeconomic goals c. redistribution of income through taxation and transfer payments d. production of public goods e. providing the economy's private goods
Identify the correct statement
a. A monopolist's pricing decision is limited by the demand for its product. b. A monopolist is able to choose any price and quantity combination that it desires. c. A monopolist can increase its profits by increasing price if the demand for its good is relatively elastic. d. A monopolist does not suffer losses even in the short run. e. A monopolist is not able to reap positive profits in the long run.
As the real interest rate in the domestic loanable funds market increases,
a. the cost of purchasing goods and services during the current period will decrease. b. the net inflow of capital from abroad will increase. c. the inflationary premium will rise and the money rate of interest will decline. d. a trade surplus will occur.