Test Bank Introduction to Econometrics 3rd Edition Complete

,Test Bank –Introductory Econometrics: A ModernApproach, 5thEditionby Jeffrey M. Wooldridge
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With PERFECT SOLUTION AVAILABLE OF ALL CHAPTERS
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Chapter 1 v




1. Econometrics is the branch of economics that . v v v v v v v




a. studiesthe behavior of individual economic agents inmaking economic decisions
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b. developsand uses statistical methods for estimatingeconomic relationships
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c. dealswith the performance, structure, behavior, and decision-making of an economy as a whole
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d. appliesmathematicalmethods to represent economictheories andsolve economic problems.
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Econometrics is based on the development of statistical v v v v v v v




methods for estimating economic relationships, testing
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economic theories, evaluating government and business
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policies.
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2. Nonexperimental data is called . v v v v




a. cross-sectional data v




b. time series data
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c. observational data v




d. panel data v




3. Which of the following is true of experimental data?
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a. Experimentaldata arecollected inlaboratory environments inthe natural sciences. v v v v v v v v v v




b. Experimentaldata cannot be collected in a controlled environment. v v v v v v v v




c. Experimentaldatais sometimes calledobservational data. v v v v v v




d. Experimentaldata is sometimes called retrospective data. v v v v v v




4. An empirical analysis relies on
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a. common sense v




b. ethical considerations v




c. data
d. customs and conventions v v




5. The term ‘u’ in an econometric model is usually referred to as the
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a. error term v




b. parameter
c. hypothesis
d. dependentvariable v




6. The parameters of an econometric model
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a. include allunobserved factors affectingthevariable being studied
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,b. describe the strength of the relationship between the variable under study and the factors affecting it
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c. refer to the explanatory variables included in the model
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d. refer to the predictions that can be made using the model
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7. Which of the following is the first step in empirical economic analysis?
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a. Collectionof data v v




b. Statement of hypotheses v v




c. Specification of an econometric model v v v v




d. Testingof hypotheses v v




8. A data set that consists of a sample of individuals, households, firms, cities, states, countries, or a
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variety of other units, taken at a given point in time, is called a(n)
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a. cross-sectional data set v v




b. longitudinal data set v v




c. time series data set
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d. experimental data set v v




9. Data on the income of law graduates collected at different times during the same year is
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a. panel data v




b. experimentaldata v




c. time series data
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d. cross-sectional data v




10. A data set that consists of observations on a variable or several variables over time is called a data
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set.
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a. binary
b. cross-sectional
c. time series v




d. experimental

11. Which of the following is an example of time series data?
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a. Data on the unemployment rates in different parts of a country during a year.
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b. Data on the consumption of wheat by 200 households during a year.
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c. Data on the gross domestic product of a country over a period of 10 years.
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d. Dataon the number of vacancies in various departments of an organization on a particular month.
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12. Which of the following refers to panel data?
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a. Data on the unemployment rate in a country over a 5-year period
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b. Data on the birth rate, death rate and population growth rate in developing countries over a 10- year
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period.
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c. Data on the income of 5 members of a family on a particular year.
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d. Dataon the price of a company’s share during a year.
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, 13. Which of the following is a difference between panel and pooled cross-sectional data?
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a. A panel data set consists of data on different cross-sectional units over a given period of time while a
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pooled data set consists of data on the same cross-sectional units over a given period of time.
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b. A panel data set consists of data on the same cross-sectional units over a given period of time while a
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pooled data set consists of data on different cross-sectional units over a given period of time
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c. A panel data consists of data on a single variable measured at a given point in time while a pooled data
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set consists of data on the same cross-sectional units over a given period of time.
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d. A panel data set consists of data on a single variable measured at a given point intime while a pooled data
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set consists of data on more than one variable at a given point in time.
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14. has a causal effect on v v v v v .
a. Income; unemployment v




b. Height; health v




c. Income;consumption v




d. Age; wage v




15. Which of the following is true? v v v v v




a. A variable has a causal effect on another variable if both variables increase or decrease
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simultaneously.
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b. Thenotion of ‘ceteris paribus’ plays animportant role incausal analysis.
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c. Difficultyin inferring causality disappears when studying data at fairly high levelsof aggregation.
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d. Theproblem of inferring causality arises if experimental data is used for analysis.
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16. Experimentaldata aresometimes called retrospective data. F v v v v v v v




17. An economic model consists of mathematical equations that describe various relationships between
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economic variables. T
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18. A cross-sectional data set consists ofobservations on a variable or severalvariables over time. F
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19. A time series data is also called a longitudinal data set. T
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20. The notion of ceteris paribus means “other factors being equal.” T
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Chapter 2 v




1. A dependent variable is also known as a(n)
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a. explanatory variable v




b. control variable v




c. predictor variable v




d. response variable v