The expected effects of a tighter monetary policy are
A. lower real interest rates.
B. exchange rate depreciation.
C. lower inflation.
D. All of these responses are correct.
Answer: C
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In the Fixed Effects regression model, you should exclude one of the binary variables for the entities when an intercept is present in the equation
A) because one of the entities is always excluded. B) because there are already too many coefficients to estimate. C) to allow for some changes between entities to take place. D) to avoid perfect multicollinearity.
Suppose that you decide to purchase either stocks or bonds of a particular corporation and you also prefer to receive some returns from the securities every year. Which should you buy - stocks or bonds? Why?
What will be an ideal response?
The current system of exchange rates can best be described as:
A. freely fluctuating exchange rates. B. managed floating exchange rates. C. rigidly fixed exchange rates. D. an adjustable peg system.
Consider the perfectly competitive firm in the above figure. The profit maximizing level of output for the firm is equal to
A) 0 units. B) 14 units. C) 17 units. D) 19 units.