What causes the natural rate of unemployment to exist?
What will be an ideal response?
Normal dynamic changes given the institutional arrangements of the economy.
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When government mandates participation in a program to solve an information asymmetry problem, it is trying to prevent:
A. moral hazard. B. adverse selection. C. building a reputation. D. illegal screening.
Can the Fed manage the federal funds rate?
a. No. It's the rate determined by banks that lend and borrow from each other b. No. It's the rate determined by government c. Yes. They do so by engaging in open market operations d. Yes. They do so by manipulating the discount rate e. Yes. They do so by manipulating the legal reserve requirement
Which of the following is an example of price discrimination?
a. Nabisco provides cents-off coupons for its products. b. Amtrak offers a lower price for weekend travel compared to weekday rates on the same routes. c. Hotel rates for AAA members are lower than for nonmembers. d. All of the above are correct.
Which of the following exemplifies why it is unlikely that a country would specialize in just one product?
a. A hurricane late in the growing season destroyed the entire sugar cane crop. b. Varieties of figs would grow but rarely ripen in the cooler, northern climate. c. The Playstation video game console sold more units than any other system. d. Food trends indicated that people were increasing their fruit consumption.