When the FDIC took over the Chicago-based Continental Illinois Bank, it
a. refused to guarantee any of the bank's deposits even though the bank was insured by FDIC because the bank had engaged in illegal practices
b. covered its deposits before allowing the bank to be taken over by the Treasury
c. allowed Continental to fail in order to set an example to other banks that engaged in overly risky loan ventures
d. sold Continental at a bargain price to Citibank
e. announced it would cover every deposit—without limit—to keep Continental alive
E
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Refer to Figure 11-4. The movement from A to B to C illustrates
A) diminishing returns to labor. B) an improvement in technology. C) a decline in capital per worker. D) diminishing returns to capital.
Using the market marginal revenue, firms in a cartel or engaged in tacit collusion should set ________ equal to ________ to maximize profit.
A) marginal revenue; marginal cost B) marginal cost; average total cost C) marginal revenue; average total cost D) price; marginal revenue
When long-run average total cost decreases as output increases, a firm experiences
a. increasing average fixed cost b. decreasing total cost c. economies of scale d. diseconomies of scale e. constant returns to scale
Which of the following is NOT a characteristic of a corporation?
A) limited liability for shareholders B) double taxation C) separation of ownership problems D) limited ability to raise capital funds