What is securitization?
What will be an ideal response?
The term refers to financial instrument in which bank assets are repackaged in readily marketable forms. This kind of "derivatives," although useful for the international investors and the banks that underwrite them, causes huge problems in government abilities to monitor bank assets and independently assess their risk to the soundness of the international banking system.
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Refer to Figure 10.1. When each player plays his or her dominant strategy, society is poorer and the payoffs are smaller by ________ units than if each player had played the strategy with the ideal outcome for both the individual players and for the
group as a whole. A) 6 B) 12 C) 18 D) 30
Which of the following is common to both tariffs and quotas?
A) Tariffs and quotas are both designed to reduce foreign competition faced by domestic firms. B) Tariffs and quotas both increase economic efficiency. C) Tariffs and quotas are both examples of voluntary export restraints. D) Tariffs and quotas are both used as a means to increase government revenue.
Which of the following statements is false?
A. If a negative externality exists, the market output is greater than the socially optimal output. B. If a positive externality exists, the market output is less than the socially optimal output. C. If there are no external costs or benefits, then it follows that marginal private costs equal marginal social costs and marginal private benefits equal marginal social benefits. D. When a positive externality exists, marginal social benefits are greater than marginal private benefits. E. none of the above
Pareto's Principle states that:
a. 20 percent of the time expended produces 80 percent of the results b. 90 percent of the time spent produces 10 percent of the results c. 75 percent of time is wasted d. A task or job fills the time available