"Economics is concerned with how individuals, institutions, and society make optimal choices under conditions of scarcity." This statement is:
A. positive but incorrect.
B. positive and correct.
C. normative but incorrect.
D. normative and correct.
Answer: B
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Banks can lower their liquidity risk by having more __________ on their balance sheet
A) government securities B) transactions deposits C) loans D) savings deposits
Adverse selection in insurance requires that
a. all people face the same risk b. potential customers facing more risk are no more interested in purchasing insurance c. people are risk averse d. insurers can tell higher risk people from lower risk people
The sales of the 50 largest corporations in the U.S. economy amount to nearly 37 percent of GDP
a. True b. False Indicate whether the statement is true or false
If firms in a competitive price-searcher market are currently experiencing economic profits, then over time,
a. new firms will enter the market, and the current firms will experience a decrease in demand for their products until zero economic profit is again restored. b. new firms will enter the market, and the current firms will experience an increase in demand for their products until zero economic profit is again restored. c. some existing firms will exit the market, and the remaining firms will experience an increase in demand for their products until zero economic profit is again restored. d. some existing firms will exit the market, and the remaining firms will experience a decrease in demand for their products until zero economic profit is again restored.