During the global financial crisis of 2008, as more people started selling their houses in fear of falling house prices, the house prices fell further. This is an example of a(n) ________
A) pecuniary externality
B) positive externality
C) information cascade
D) moral hazard
C
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A regulatory agency concerned with "universal service" must
a. prevent high profits in all markets. b. prevent entry in high-profit markets. c. prevent cross-subsidization. d. guarantee marginal cost pricing.
Which of the following statements is correct?
a. Human capital per worker is a determinant of productivity. b. A nation cannot be highly productive in producing goods and services without abundant quantities of natural resources. c. Human capital and technological knowledge are the same thing. d. All technological knowledge is proprietary.
The process of the investment accelerator involves
a. positive feedback from aggregate demand to investment. b. negative feedback from aggregate demand to investment. c. positive feedback from aggregate supply to investment. d. negative feedback from aggregate supply to investment.
Suppose that the number of units of good A consumed falls 10 percent when the price of good B falls 5 percent. The cross price elasticity of demand between goods A and B is
A. 2.0. B. 0.2. C. 0.5. D. 5.