The result that, under certain circumstances, no government action is needed to control an externality because it can be eliminated by bargaining between the affected parties is called
A) a Nash Equilibrium.
B) Coase Theorem.
C) Bargaining Theorem.
D) English Bargaining.
B
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The imposition of a tax on a good enables the government to
A) raise the price received by sellers of the goods that have been taxed. B) lower the price paid by buyers for the goods that have been taxed. C) create a more efficient economic system. D) take part of consumer and producer surplus as tax revenue when the good is purchased. E) decrease the deadweight loss in this market.
There are many ways developing countries finance their external deficits EXCEPT
A) bank finance. B) portfolio investment in ownership of firms. C) bond finance. D) official lending. E) foreign exchange rates.
If managers do not choose to maximize profit, but pursue some other goal such as revenue maximization or growth,
A) they are more likely to become takeover targets of profit-maximizing firms. B) they are less likely to be replaced by stockholders. C) they are less likely to be replaced by the board of directors. D) they are more likely to have higher profit than if they had pursued that policy explicitly. E) their companies are more likely to survive in the long run.
The velocity of money in circulation measures: a. the average length of time that people hold wealth
b. how fast aggregate spending will increase for a given decline in money demand. c. how fast inflation will rise for a given increase in the money supply. d. how quickly money changes hands. e. how quickly banks can create money.