The widespread fall in the prices of homes caused consumers to:
A. increase their spending, as they devoted their money to things other than homes.
B. increase their spending, as saving was viewed as a bad investment.
C. decrease their spending, as they struggled to pay back debt.
D. decrease their spending, and increase their debts.
Answer: C
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Which of the following statements is false?
A. Greater distance reduces the likelihood of migration B. Greater stocks of human capital result in greater personal productivity and earnings C. The majority of international migrants move to countries relatively close to their home countries D. Implicit costs of migrating are not affected by distance
A multiperiod regression forecast h periods into the future based on an AR(p) is computed
A) the same way as the iterated AR forecast. B) by estimating the multiperiod regression Yt = ?0 + ?1Yt-h + ... + ?pYt-p-h+1 + ut, then using the estimated coefficients to compute the forecast h periods in advance. C) by estimating the multiperiod regression Yt = ?0 + ?1Yt-h + ut , then using the estimate coefficients to compute the forecast h period in advance. D) by first computing the one-period ahead forecast, next using that to compute the two-period ahead forecast, and so forth.
Smith drives his car numerous places. Sometimes he drives his car around his residential neighborhood and sometimes he drives it on the highway. Occasionally, Smith gets peeved with the way other people drive and makes a rude gesture to them. Based on one of the theories discussed in the textbook, he is
A) more likely to make a rude gesture to another driver on the highway than in his residential neighborhood. B) less likely to make a rude gesture to another driver on the highway than in his residential neighborhood. C) equally likely to make a rude gesture to another driver on the highway as in the residential neighborhood. D) There is not enough information provided to answer this question.
An example of a market failure is when:
A. a firm selling a product faces competition from many other sellers. B. a good is priced too high for poor families to afford. C. the distribution of surplus is unfair. D. one person's consumption of a good imposes costs on others