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The variance of the OLS estimator is VAR( ^B)=σ2 /ns2x , where s2x=£x2/x You're hired to estimate and you're going to be paid according to the accuracy of your estimate. Specifically, your revenue is ¥/std (B). You can buy as many observations as you want at price . The sample variance of , never changes. How many observations should you buy?
fundamental concepts of decision-making theory The fundamental concepts of decision-making theory have been culled from microeconomic theory and have been furnished with new t
a) In 1948, the money GNP was $520 billion and the price index was 120. In order to make the 1948 GNP comparable with the base year, the 1948 GNP must be adjusted to:
DIRECT TAXES A direct tax is one where the impact and incidence of the Tax is on the same person e.g. Income Tax, death or estate duty, corporation taxes and capital gains
Point elasticity The point elasticity of demand is described as the proportionate change in quantity demanded in response to a very small proportionate change in price. The con
Price Elasticity of Supply Price Elasticity of supply measures the degree of responsiveness of quantity supplied to changes in price. The co-efficient of the elasticity of s
Uses of Indifference Curve Analysis Indifference curve analysis is useful when studying welfare economics as follows: They are used to indicate the amount of income and
The Multiplier In his theory Keynes asserted that consumption is a function of income, and so it follows that a change in investment, which we may call ΔI, meaning an incremen
Determinants of the money supply Two extreme situations are imaginable. In the first situation, the money supply can be determined at exactly the amount decided on by the Cen
factors influencing the demand for dove soap
Measures to control inflation An inflationary situation can effectively be addressed/tackled if the cause is first and foremost identified. Governments have basically three
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