Introduction to Econometrics, Stock - Complete test bank - exam questions - quizzes (updated 2022)

Test Bank
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, Introduction to Econometrics, 4e (Stock/Watson
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)Chapter 1 Economic Questions and Data
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1.1 Multiple Choice Questions 01 01




1) Analyzing the behavior of unemployment rates across U.S. states in March of 2006 is
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anexample of using:
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A) time series data.
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B) panel data. 01




C) cross-sectional data. 01




D) experimental data 01




.Answer: C
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2) Studying inflation in the United States from 1970 to 2006 is an example of using:
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A) randomized controlled experiments. 01 01




B) time series data.
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C) panel data. 01




D) cross-
sectional data.Answer:
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0 1 B


3) Analyzing the effect of minimum wage changes on teenage employment across the
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48contiguous U.S. states from 1980 to 2004 is an example of using:
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A) time series data.
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B) panel data. 01




C) having a treatment group vs. a control group, since only teenagers receive minimum wages.
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D) cross-
sectional data.Answer:
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0 1 B


4) Panel data: 01




A) is also called longitudinal data.
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B) is the same as time series data.
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C) studies a group of people at a point in time.
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D) typically uses control and treatment groups
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.Answer: A
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, 5) Econometrics can be defined as follows with the exception of: 01 01 01 01 01 01 01 01 01




A) the science of testing economic theory.
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B) fitting mathematical economic models to real-world data.
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C) a set of tools used for forecasting future values of economic variables.
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D) measuring the height of economists 01 01 01 01




.Answer: D
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6) To provide quantitative answers to policy questions:
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A) it is typically sufficient to use common sense.
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B) you should interview the policy makers involved.
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C) you should examine empirical evidence.
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D) is typically impossible since policy questions are not quantifiabl
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e.Answer: C
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7) An example of a randomized controlled experiment is when:
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A) households receive a tax rebate in one year but not the other.
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B) one U.S. state increases minimum wages and an adjacent state does not, a
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ndemployment differences are observed.
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C) random variables are controlled for by holding constant other factors.
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D) some 5th graders in a specific elementary school are allowed to use computers at sch
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oolwhile others are not, and their end-of-
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year performance is compared holding constant otherfactors.
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Answer: D 0 1




8) Ideal randomized controlled experiments in economics are:
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A) often performed in practice. 01 01 01




B) often used by the Federal Reserve to study the effects of monetary policy.
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C) useful because they give a definition of a causal effect.
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D) sometimes used by universities to determine who graduates in four years rather th
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anfive. Answer: C
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9) Most economic data are obtained:
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A) through randomized controlled experiments. 01 01 01




B) by calibration methods.
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C) through textbook examples typically involving ten observation points.
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D) by observing real- 01 01




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, world behavior.Answer: D
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10) One of the primary advantages of using econometrics over typical results from econom
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ictheory, is that:
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A) it potentially provides you with quantitative answers for a policy problem rather than simp
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lysuggesting the direction (positive/negative) of the response.
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B) teaching you how to use statistical packages 01 01 01 01 01 01




C) learning how to invert a 4 by 4 matrix. 01 01 01 01 01 01 01 01




D) all of the above 01 01 01




.Answer: A
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11) In a randomized controlled experiment:
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A) there is a control group and a treatment group.
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B) you control for the effect that random numbers are not truly randomly generated
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C) you control for random answers
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D) the control group receives treatment on even days onl
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y.Answer: A
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12) The reason why economists do not use experimental data more frequently is for all of
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thefollowing reasons EXCEPT that real-world experiments:
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A) cannot be executed in economics. 01 01 01 01




B) with humans are difficult to administer.
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C) are often unethical. 01 01




D) have flaws relative to ideal randomized controlled experiment
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s.Answer: A
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13) The most frequently used experimental or observational data in econometrics are of t
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hefollowing type:
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A) cross-sectional data. 01




B) randomly generated data. 01 01




C) time series data. 01 01




D) panel data. 01 01




Answer: A 0 1




14) In the graph below, the vertical axis represents average real GDP growth for 65 countr
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ies over the period 1960-
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