In a competitive market, if buyers did not know all the prices charged by the many firms
A) all firms still face horizontal demand curves.
B) firms sell a differentiated product.
C) demand curves can be downward sloping for some or all firms.
D) the number of firms will most likely decrease.
C
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Everything else held constant, an increase in the time deposit ratio will result in ________ in the M1 money multiplier and ________ in the M2 money multiplier
A) an increase; an increase B) no change; an increase C) a decrease; a decrease D) no change; a decrease
Your textbook mentions heteroskedasticity- and autocorrelation- consistent standard errors. Explain why you should use this option in your regression package when estimating the distributed lag regression model
What are the properties of the OLS estimator in the presence of heteroskedasticity and autocorrelation in the error terms? Explain why it is likely to find autocorrelation in time series data. If the errors are autocorrelated, then why not simply adjust for autocorrelation by using some non-linear estimation method such as Cochrane-Orcutt? What will be an ideal response?