In order to achieve a high economic freedom rating, a country must
What will be an ideal response?
protect property rights, enforce contracts even-handedly, and rely extensively on markets to allocate goods and services
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Suppose that a firm can invest $100 today in a project and receive $105 a year from today. There is no inflation, and the annual interest rate in the economy is 4%. The firm should
A) invest in the project because the opportunity cost is the same as the return on the investment. B) invest in the project because the opportunity cost is greater than the return on the investment. C) invest in the project because the opportunity cost is less than the return on the investment. D) not invest in the project because the opportunity cost is less than the return on the investment.
A game in which players want to coordinate on an outcome and in which both agree that coordinating on one particular outcome is preferred to coordinating on the other is called
A) an assurance game. B) a pure coordination game. C) a battle of the sexes game. D) a chicken game.
A feedback from low real wages to low productivity could be caused by
A) an increase in the labor force caused by more immigration. B) a reduction in the power of labor unions. C) a reduction in the real minimum wage. D) increased worker anxiety about job security. E) all of the above.
The demand deposit multiplier is the number by which we must multiply the
a. injection of reserves to get the total change in demand deposits b. total amount of demand deposits to get the total change in the money supply c. level of required reserves to get the total change in the money supply d. total amount of currency in circulation to find total demand deposits e. change in demand deposits to find the total change in the money supply