One of the following is a regression example for which Entity and Time Fixed Effects could be used: a study of the effect of
A) minimum wages on teenage employment using annual data from the 48 contiguous states in 2006 .
B) various performance statistics on the (log of) salaries of baseball pitchers in the American League and the National League in 2005 and 2006.
C) inflation and inflationary expectations on unemployment rates in the United States, using quarterly data from 1960-2006.
D) drinking alcohol on the GPA of 150 students at your university, controlling for incoming SAT scores.
Answer: B
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Describe the connections between rising income and environmental and social indicators. Which indicators improve and which worsen as national income rises?
What will be an ideal response?
When a firm uses profits to purchase new capital equipment, it is engaging in
A) tax evasion. B) balance sheet accounting. C) reinvestment. D) the most risky way the firm can obtain investment funds.