If firms have to account for external costs of production, then they will ________ compared with what they would do if they did not have to account for the external costs.

Aggregate demand changes when government expenditure on national defense increases by $100 billion. Aggregate demand ________ by ________ than $100 billion because government expenditure ________ induced expenditure

A) decreases; more; decreases B) decreases; less; increases C) increases; less; increases D) increases; more; increases E) increases; more; decreases

Infeasible GLS

A) requires too much memory even for today's PCs. B) uses complicated interative techniques. C) cannot be calculated since it also uses quasi differences for Xt. D) assumes the parameters of the error autocorrelation process to be known.