Multiple Choice
The propensity δ0 + δ1+ … + δk is sometimes called the:
A) short-run elasticity, which measures the percentage increase in a dependent variable after k quarters given a permanent 1% increase in the k independent variables.
B) long-run elasticity, which measures the percentage increase in a dependent variable after k quarters given a permanent 1% increase in the k independent variables.
C) short-run elasticity, which measures the percentage decrease in a dependent variable after k quarters given a permanent 1% decrease in the k independent variables.
D) long-run elasticity, which measures the percentage decrease in a dependent variable after k quarters given a permanent 1% decrease in the k independent variables.
Correct Answer:
Verified
Correct Answer:
Verified
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