Technical change that results in a change in the production process is known as disembodied technical change.

Refer to Figure 26-7. Suppose the Fed lowers its target for the federal funds rate. Using the static AD-AS model in the figure above, this situation would be depicted as a movement from

A) C to D. B) A to B. C) C to B. D) E to A. E) B to A.

The binary variable interaction regression

A) can only be applied when there are two binary variables, but not three or more. B) is the same as testing for differences in means. C) cannot be used with logarithmic regression functions because ln(0) is not defined. D) allows the effect of changing one of the binary independent variables to depend on the value of the other binary variable.