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Consider a simple model to estimate the effect of personal computer (PC) ownership on college grade point average (GPA), GPA = beta 0 + beta 1PC + u where PC is a binary variable indicating PC ownership. Why might PC ownership be correlated with the error term u? Would such a correlation present problems for the use of OLS estimation? Explain why PC is likely to be related to parent's income. Would parent's income be a good Instrumental Variable for PC? Why or why not? Suppose that, four years ago, the university gave computers to one - half of the new incoming students on a randomly selected basis. Explain how you would use this information to construct an instrumental variable for PC. Explain how you could use the instrumental variable from iv) above to test for the endogeneity of PC in this simple model.
The state government collected all taxes due, but its tax revenues were equal to $40 million each year. What happened to the sales tax base between 2006 and 2007? What could account for this result?
Illustrate what additional information is needed for you to be able to compute the price elasticity of demand for DVD players.
Suppose the firms compete in quantities. If firm 1 deviates from collusion in one period, what is the profit of firm 1 in that period in subsequent periods.
Limited partnership arrangements alleviate which traditional problem associated with real estate investments.
the quantity demanded of Cake is 100 slices and the quantity demanded of cheese bread is 100 pieces.
Explain how does global economic competition impact price elasticity in domestic market and decisions related to strategy a firm uses to compete.
Explain it surprising that the company's revenue increased when it decreased the average selling price of its phones.
Explain how much of input 2 does it use. B) What is the most that it is willing to bribe an inspector to allow it to use another unit of input 1.
Lauren Moore has sold her business for $720,000 also wants to invest in condominium units (
I think the blaming China is just another move by the administration to take the country in the wrong direction, possibly with tariffs or restrictions on imports for countries such as China.
Explain why does a newspaper dispenser open to a stack of newspaper and essentially "trusts" a consumer to take just one copy.
Is this analysis consistent with the proposition which money has real effects in the short run but is neutral in the long run.
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