Ordinary least squares estimation is subject to heterogeneity bias if _____.
A. the regression model exhibits heteroskedasticty
B. the unobserved effect is correlated with the observed explanatory variables
C. the regression model includes a lagged dependent variable
D. the explanatory variables do not change over time
Answer: B
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The demand curve slopes downward because of:
a. diminishing marginal utility and consumer equilibrium. b. the fact that consumers cannot decide how much they want to pay for goods and services. c. the fact that suppliers cannot decide how much to charge for the goods and services they supply. d. the fact that consumer tastes and preferences change rapidly. e. the fact that consumers are fickle, which makes pricing a good or service very difficult.
A union can always get the wage rate it demands from a monopsonist, but not from a perfectly competitive employer
Indicate whether the statement is true or false
A checking account balance in a commercial bank is
A) part of the currency supply. B) a time deposit. C) not liquid enough to be considered money. D) an asset readily usable for most transactions.
A labor contract provides for a first-year wage of $10 per hour, and specifies that the real wage will rise by 3 percent in the second year of the contract. The CPI is 1.00 in the first year and 1.07 in the second year. What dollar wage must be paid in the second year?
A. $10.90 B. $10.70 C. $11.02 D. $10.30