Consider the following regression equation: y= 
0+ 1x1+ …+ kxk + u
In which of the following cases, the dependent variable is binary?
A. y indicates the gross domestic product of a country
B. y indicates whether an adult is a college dropout
C. y indicates household consumption expenditure
D. y indicates the number of children in a family
Answer: B
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Suppose that two clothing manufacturers, Frederick's Fashions and Stephan's Styles, announce that they plan to merge. The Herfindahl-Hirschman index is currently 1,500. After the merger, the HHI will rise to 1,560. This market is
A) highly concentrated and so the government will definitely challenge the merger. B) moderately concentrated and because the merger increases the HHI by more than 50 points, the government will definitely challenge the merger. C) moderately concentrated, but because the merger increases the HHI by less than 100 points, the government will probably not challenge the merger. D) competitive and so the government will not challenge the merger.
Which of the following could help explain why professional football players have high salaries?
a. There is little social status attached to the occupation. b. Their marginal revenue products are typically very low. c. They face a high chance of having their careers cut short. d. Many college football players want to become professional football players. e. The labor market is perfectly competitive due to the players' union.
Which of the following is not an example of a type of factor of production?
a. land b. labor c. government d. capital
Structural policy refers to:
A. policy directed toward increasing exports and reducing imports. B. decisions to determine the government's budget. C. government policies aimed at changing the underlying structure or institutions of the economy. D. the determination of the nation's money supply.