Which of the following questions is not answered by general equilibrium analysis?
A. Can all markets simultaneously be in equilibrium?
B. Are equilibria in different markets compatible with one another?
C. How will a change in one market affect another market?
D. What outcome is most desirable for the whole society?
Answer: D
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You want to buy a TV that regularly costs $250. You can either buy the TV from a nearby store or from a store that's downtown. Relative to going to the nearby store, driving downtown involves additional time and gas. The downtown store, however, has a 10% off sale this week. Last week you drove downtown to save $20 on some concert tickets, a 15% savings. Should you drive downtown to buy the TV?
A. Yes, because you will save more than $20. B. Yes, because you will save 10%, which is better than nothing. C. No, because you will only save 10%, which is less than 15%. D. No, because you will save more than $20.
What is fiscal federalism?
What will be an ideal response?
What is the Nash equilibrium of this game?
a. Both of them clean the apartment b. John cleans, Joe doesn't c. Joe cleans, John doesn't d. Neither of them clean the apartment
If the Fed wanted to reduce the federal funds interest rate, it might: a. increase the discount rate
b. increase the required reserve ratio. c. buy government securities. d. sell government securities.