Macroeconomics 5th Edition by Olivier Blanchard

Exercise 3

Using the information in this chapter, label each of the following statements true, false, or uncertain. Explain briefly.
a. For a typical college student, human wealth and nonhuman wealth are approximately equal.
b. Natural experiments, such as retirement, do not suggest that expectations of future income are a major factor affecting consumption.
c. Buildings and factories depreciate much faster than machines.
d. A high value for Tobin's q indicates that the stock market believes that capital is overvalued, and thus investment should be lower.
e. Economists have found that the effect of current profit on investment can be fully explained by the effect of current profit on expectations of future profits.
f. Data from the past three decades in the United States suggest that corporate profits are closely tied to the business cycle.
g. Changes in consumption and investment typically occur in the same direction and at roughly the same magnitude.