Which of the following is a feature of a bond market?
a. Only households can borrow money through a bond market
b. Only corporations can borrow money through a bond market.
c. Both households and corporations borrow money from a bond market.
d. Both corporations and government borrow money from a bond market.
d
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Other things equal, when U.S. money moves to other countries to take advantage of better foreign investment opportunities, then:
a. the U.S. money supply will increase. b. the reserve requirement for U.S. banks will rise. c. the U.S. money supply will decrease. d. U.S. banks will have excess reserves to loan out. e. the effect of the U.S. deposit expansion multiplier will be increased.
Which statement best describes social surplus?
a. the sum of consumer surplus and producer surplus b. the amount that a seller is paid for a good minus the seller’s actual cost c. the amount that individuals would have been willing to pay, minus the amount that they actually paid d. when it is impossible to improve the situation of one party without imposing a cost on another
The most important way in which inefficiency occurs is
a. producing more military goods instead of civilian goods. b. limiting economic growth by limiting capital spending. c. unemployment of labor and other resources. d. producing outside the production possibilities frontier. e. All of the above are correct.
The deadweight loss (or excess burden) resulting from levying a tax on an economic activity is the
a. tax revenue raised by the government as the result of the tax. b. loss of potential gains from trade from activities forgone because of the tax. c. increase in the price of an activity as the result of the tax levied on it. d. marginal benefits derived from the expansion in government activities made possible by the increase in tax revenues.