If private giving to public goods involves externalities, what is a Pigouvian solution to the public goods problem?
What will be an ideal response?
Pigou suggests subsidies to internalize positive externalities. Public goods generate positive externalities, and private giving to public goods generates positive externalities. Thus, Pigou would suggest subsidizing private giving such that the per-dollar subsidy is equal to the sum of the marginal benefits of everyone other than the person who is giving.
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A. If a stock is expected to pay an annual dividend of $20 forever, what is the approximate present value of the stock, given that the discount rate is 5%?
b. If a stock is expected to pay an annual dividend of $20 forever, what is the approximate present value of the stock, given that the discount rate is 8%? c. If a stock is expected to pay an annual dividend of $20 this year, what is the approximate present value of the stock, given that the discount rate is 8% and dividends are expected to grow at a rate of 2% per year?
An increase in the money supply
a. raises the interest rate, causing an increase in quantity demanded of investment and an increase in GDP b. lowers the interest rate, causing an increase in quantity demanded of investment and an increase in GDP c. raises the interest rate, causing a decrease in quantity demanded of investment and an increase in GDP d. lowers the interest rate, causing a decrease in quantity demanded of investment and an increase in GDP e. lowers the interest rate, causing a decrease in quantity demanded of investment and a decrease in GDP
In most of the financial crises of the last decade, there were large and sudden financial outflows as both home and foreign investors tried to avoid the expected crises
Indicate whether the statement is true or false
Assuming a reserve ratio of 10 percent, if a bank sells $200,000 in securities how much can the bank loan out?
A. $180,000 B. $20,000 C. $100,000 D. $2,000,000