When Xt is strictly exogenous, the following estimator(s) of dynamic causal effects are available:
A) estimating an ADL model and calculating the dynamic multipliers from the estimated ADL coefficients
B) using GLS to estimate the coefficients of the distributed lag model
C) neither (a) or (b)
D) (a) and (b)
Answer: D
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The implied growth rate for a country between 1960 and 2010 is 6%. This implies that:
A) the country needed to grow at an average rate of 6% per year between 1960 and 2010 to reach the 2010 level of GDP starting with the 1960 level. B) the country needed to grow by at least 6% in any of the fifty years between 1960 to 2010 to reach the level of GDP in 2010 starting with the 1960 level. C) the growth rate of GDP in the country was above 6% between 1960 to 1990 and above 6% between 1991 and 2010. D) the country needed to grow at rates above 6% per year between 1960 and 2010 to reach the 2010 level of GDP starting from the 1960 level.
An interest rate spread is
A) the difference between long-term and short-term interest rates. B) the difference between nominal and real interest rates. C) the difference between lending and borrowing interest rates. D) the difference between public and commercial interest rates.
Tom and Jerry have two tasks to do all day: makedishes and build fences. If Tom spends all day makingdishes, he will have make 16 dishes. If he instead devotes his day to building fences, Tom will build 4 fences. If Jerry spends his day makingdishes, he will make 14 dishes; if he spends the day building fences, he will build 7 fences. After looking at the production possibilities for both Tom and Jerry, we can conclude that:
A. Tom has the comparative advantage in dish production. B. Jerry has the comparative advantage in dish production. C. Tom has the comparative advantage in fence production. D. No comparative advantage exists.
In the presence of Regulation Q, when interest rates would rise, _____
a. the transaction demand for money in the economy would increase b. people would invest in the bond markets c. the economy would grow faster d. people would withdraw money from banks seeking higher interest rates elsewhere e. the U.S. dollar would depreciate