One of the Following Is a Regression Example for Which

question 37

Multiple Choice

One of the following is a regression example for which Entity and Time Fixed Effects could be used: a study of the effect of

• A)minimum wages on teenage employment using annual data from the 48 contiguous states in 2006 .
• B)various performance statistics on the (log of)salaries of baseball pitchers in the American League and the National League in 2005 and 2006.
• C)inflation and inflationary expectations on unemployment rates in the United States, using quarterly data from 1960-2006.
• D)drinking alcohol on the GPA of 150 students at your university, controlling for incoming SAT scores.

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Definitions:

Capital Budgeting

The process of planning significant investments in projects that have long-term implications such as the purchase of new equipment or the introduction of a new product.

Screening Tool

A method or instrument used to assess or evaluate certain characteristics in individuals or scenarios, often used in healthcare, employment, and research.

Net Present Value

Net Present Value calculates the difference between the present value of cash inflows and the present value of cash outflows over a period, used to assess the profitability of investments.

Internal Rate

Often related to the internal rate of return (IRR), it is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.