Systemic risks are most likely to exist with regard to
a. small governments.
b. large governments.
c. small financial institutions.
d. large financial institutions.
d
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Inflation tends to ________ during a business cycle expansion and ________ during a business cycle recession
A) increase; decrease B) decrease; increase C) increase; increase further D) decrease; decrease further
Price floors are only effective below the market equilibrium
a. True b. False Indicate whether the statement is true or false
We would expect an industry to expand if firms in that industry are:
A. earning normal profits. B. earning economic profits. C. breaking even. D. earning accounting profits.
Applied to perfectly competitive labor markets, the marginal principle tells firms to hire workers until:
A. the marginal revenue product of the last worker hired equals the wage. B. marginal productivity begins to diminish. C. average total costs are minimized. D. the price of the product equals the wage of the worker.