Which of the following is true of regulation?
a. Regulatory agencies often ignore the secondary effects of their actions and fail to foresee future problems.
b. Policy-makers are hesitant to call for new regulations even when it is clear they would help avert future crises.
c. Mortgage lending and banking have historically been unregulated and therefore regulation in these sectors will be unpopular.
d. Past regulations have been effective at averting crises, but they are unpopular because they reduce the profitability of the regulated industry.
A
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Marginal utility theory predicts that if a consumer's income decreases, the consumer
A) buys fewer normal goods. B) buys fewer inferior goods. C) buys more of all goods. D) might either increase or decrease purchases of normal goods.
The largest component of the money supply (M1 ) is
A) time deposits. B) large CDs. C) demand deposits. D) coin and currency.
The classical theory states that
a. demand is generally greater than supply. b. supply creates its own demand. c. supply is generally greater than demand. d. prices and interest rates are always stable.
What is demand?
A) The idea that buyers will purchase more of a product as the price drops B) The price and quantity of a product at which the quantity demanded is equal to the quantity supplied C) The idea that producers will offer more of a product as the price rises D) The willingness and ability of buyers to purchase a product E) None of these