Which is NOT a potential cost faced by nations that choose against repaying their debts?

A. A loss of foreign assets
B. Domestic recession
C. Moral hazard
D. A loss of future creditworthiness


Answer: C

Economics

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Refer to Figure 5-1. Marginal social benefit is represented by which curve?

A) Supply B) D1 C) D2 D) All of the above represent marginal social benefit.

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Which of the following groups believes that by managing aggregate demand, government can achieve the most acceptable combination of unemployment and inflation?

a. classical school b. monetarists c. neo-Keynesian school d. rational expectations school e. supply-side school

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As you move down the production possibility frontier, the absolute value of the marginal rate of transformation

A. increases. B. initially decreases, then increases. C. decreases. D. initially increases, then decreases.

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"Regulatory capture" refers to the situation where a government agency charged with supervising and regulating a particular industry is:

A. Strongly influenced by the firms in that industry B. Headed by bureaucrats who have a "lock" on their positions, without any rivals C. Completely dominating the actions of firms in the industry D. Headed by unelected government officials

Economics