Explain how a bank run can cause a bank to fail?
What will be an ideal response?
If a bank experiences a bank run, it experiences a liquidity problem because its loans cannot be easily sold off to provide funds to pay off depositors. Without funds to pay off depositors, the bank will not be able to stay in business.
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John has a marginal benefit of $7 for 1 slice of pizza, $5 for a second slice, $3 for a third slice, $1 for a fourth slice, and $0.50 for a fifth slice. The price of pizza is $1.50 per slice. Which of the following statements is correct?
A) John will purchase 3 slices of pizza and have consumer surplus of $10.50. B) John will purchase 4 slices of pizza and have consumer surplus of $12.00. C) John will purchase 2 slices of pizza and have consumer surplus of $1.50. D) John will purchase 3 slices of pizza and have consumer surplus of $4.50. E) John will purchase 2 slices of pizza and have consumer surplus of $3.00.
Which of the following statements is true?
A) In the long run, the average cost curve is always downward sloping. B) In the long run, the quantities of all inputs are fixed. C) In the long run, the firm's fixed costs are greater than its variable costs. D) In the long run, all costs are variable costs. E) In the long run, the total variable cost equals the total fixed cost.
A recession occurs when real GDP decreases for at least 6 months
Indicate whether the statement is true or false
The conditions that will always identify a Nash equilibrium include:
a. subjectively getting into the mind of one's opponent b. a reflexive assessment of the best reply responses c. a prospective condition of improvement d. a through c e. b and c only