Refer to the Article Summary. In 2015, the European Union initiated the BRRD program, where the burden of bailing out troubled banks is being placed on bank creditors, shareholders, and possibly depositors
If this program were to confiscate funds from bank deposits to assist troubled banks, the possibility of a bank run, a situation in which ________, would likely increase.
A) many depositors simultaneously decide to withdraw money from a bank.
B) a majority of the bank's loans go into default all at once.
C) a majority of the shareholders in a bank decide to sell off all their shares of stock.
D) a bank stops paying interest on all of its interest-bearing accounts.
A
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The price elasticity of demand for a variable input will be more elastic in all the following cases EXCEPT
A) the greater the price elasticity of demand for the final product. B) the easier it is for a particular variable input to be substituted for by other inputs. C) the larger the proportion of total costs accounted for by a particular variable input. D) the shorter the time period being considered.
In Figure 28.1, if the rate of output is 320 units,
A. There is government failure. B. Social costs exceed private costs at this rate of output. C. Pollution costs are internalized. D. Output is less than the socially optimal level.
A borrower's willingness to sign a personal guarantee is
A) one form of the moral hazard problem. B) one form of the adverse selection problem. C) a signal of a high-quality borrower. D) a signal of a low-quality borrower.
The main source of loanable funds in an economy is the foreign direct investment made into the economy
a. True b. False Indicate whether the statement is true or false