In the principal-agent problem, the principal is:
A. a person who entrusts someone with performing a task.
B. a person who carries out a task on someone else's behalf.
C. a person who is in charge of an educational system.
D. a person who is the source of the problem.
A. a person who entrusts someone with performing a task.
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Most analysts in the United States and the international financial community initially perceived the debt crisis as a temporary, short-run liquidity problem so they advised increasing capital flows to Latin America
Indicate whether the statement is true or false
When a bank issues a checkable deposit and loans the funds out to a business, it has transformed
A) a financial asset for a saver into a liability for a borrower. B) a financial liability for a saver into a financial asset for a borrower. C) a short-term liability to a borrower into a long-term asset to a saver. D) one liability into another liability.
Forecasts are
A) generally incorrect. B) predictions about the future. C) explanations of past occurrences. D) limited to short time periods.
Using the production function Real GDP = T (L, K), and the LRAS curve, describe the process by which a decline in taxes on the returns to capital impacts economic growth