Which of the following is a reason why the governments of the weaker economies of Europe have limited ability to engage in bank bailouts?
A. Their home currencies are volatile and vulnerable to depreciation.
B. They are prohibited to do so by their central banks.
C. They cannot reform their budgets to be able to receive assistance.
D. They do not have the ability to borrow the required amount of funds.
Answer: D
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Refer to Figure 5-16. Suppose Amit and Bree know each other's preferences so that it is not possible for one to deceive the other
Which of the following statements best describes the circumstances under which the optimal quantity of street lights could be achieved? A) The optimal quantity will be installed only if Bree pays for the entire installation cost. B) The optimal quantity will be installed only if the two parties agree to pay according to their willingness to pay as indicated by their respective demand curves. C) Because there are only two consumers, it is likely that private bargaining will result in the optimal quantity being installed. D) The optimal quantity will be installed only if the two parties split the cost of installation equally.
If the price elasticity of demand for a good is less than one in absolute value, economists would characterize consumers of this good
A) as not very sensitive to price. B) as not very sensitive to the quantity they demand. C) as very sensitive to price. D) as elastic.
Using the fiscal year 2014 estimates, the largest component of state and local revenue is the
A) individual income tax. B) corporate income tax. C) revenue from the federal government. D) sales, excise, and gross receipts taxes.
Explain why the long-run average cost is typically U-shaped