Suppose Joe has a reliable two-year old Honda Civic that's in excellent condition and that he would be willing to sell for $13,000. Lauren, who is risk-neutral, is considering whether to buy Joe's car. She's willing to pay $14,000 for a two-year Honda Civic that is reliable and only $10,000 for one that's not reliable. Lauren cannot tell whether Joe's car is reliable, but she believes that only 20 percent of two-year old Hondas for sale in the market are reliable and that the other 80 percent are not reliable. To Lauren, Joe's car looks just like every other two-year Honda that's for sale. What's the most Lauren is willing to pay for Joe's car?
A. $14,000
B. $13,000
C. $10,000
D. $10,800
Answer: D
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Based on the information in the table, we can conclude that, in 1932, each of the following events occurred except: Currency held by public(in billions)Reserve-deposit ratioBank reserves (in billions)Money supply (in billions)December 1931$4.590.095$3.11$37.3December 1932$4.820.109$3.18$34.0
A. Banks were keeping more of their deposits in reserves, and making fewer loans. B. The Federal Reserve injected reserves into the banking system. C. The Federal Reserve conducted open-market sales of U.S. government bonds. D. The public increased the amount of currency it held.
Intellectual property
a. requires copyright protection that is expensive to obtain, but cheap to enforce b. usually ends up being owned by the government c. is costly to produce, but can be transmitted at low cost d. cannot be owned by anyone e. is usually located on college campuses
According to the FTC, antitrust regulations are in place because mergers that lessen competition can lead to:
a. too many goods and services. b. higher quality products. c. higher prices. d. a decentralized market.
Which of the following observations concerning GDP calculations is true?
a. Goods and services produced by governments are valued at market price. b. Inventories are treated as if they are yet to be sold. c. Goods produced but not sold during the year are counted in that year's GDP. d. Goods that firms add to their inventories do not count in the GDP.