As the housing bubble collapsed, the cycle of defaults and falling prices began that would ultimately cause home values to:
A. stop rising, practically halting the mortgage loan industry for a number of years.
B. fall by more than 90 percent in the hardest-hit areas.
C. fall by more than 50 percent in the hardest-hit areas.
D. fall by about 25 percent in the hardest-hit areas.
Answer: C
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Which approach to calculating GDP is especially useful in clarifying the resale of existing goods?
A. The expenditure approach B. The income approach C. The value-added approach D. Any of these measurements will allow that kind of clarification equally well.
If the price of inputs rises and personal income taxes rise:
a. Price index rises, and real GDP falls. b. Price index rises, and the change in real GDP is uncertain. c. The change in price index is uncertain, and real GDP falls. d. Price index falls, and real GDP rises. e. Price index falls, and real GDP falls.
If Anne receives more satisfaction as she consumes more shoes, then:
A. the marginal utility of shoes is positive. B. the marginal utility of shoes is negative. C. the marginal utility of shoes is constant. D. the marginal utility of shoes is zero.
Glintz and Meck are two oligopolistic firms that agree to align their pricing strategies for the coming year. However, Glintz suspects that Meck will not honor the agreement. What can Glintz do to minimize its potential loss in this situation?
a. Form a cartel with Meck to ensure that collusion succeeds. b. Defect from the agreement first by lowering its prices. c. Convince other competitors to join the collusive oligopoly. d. Defect from the agreement first by raising its prices.