Some of the nation's best minds are occupied with devising schemes to avoid taxes and to transfer income to favored groups at the expense of market efficiency. This is called _____
A) hedging.
B) pork-barrel spending.
C) rent seeking.
D) skimming.
E) profiteering.
Ans: C) rent seeking.
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A shortcoming of swaps that has led to the domination of the swaps market by large firms and financial institutions is
A) the lack of privacy. B) need to assess creditworthiness. C) desire for more flexibility. D) limited size of the market.
Tax policy can affect ____________________ and investment spending, resulting in a shift in the AD curve.
a. consumption b. savings c. production d. government
If pollution is reduced below the socially efficient level:
a. the marginal cost of pollution abatement exceeds the marginal benefit of pollution abatement
b. the marginal cost of pollution abatement is less than the marginal benefit of pollution abatement.
c. the marginal cost of pollution abatement equals the marginal benefit of pollution abatement.
d. nothing can be said about the relationship between the marginal cost and marginal benefit of pollution abatement.
If a strategic move is credible, it is likely to
A. change the actions of rivals. B. result in repeated, sequential interactions. C. be the dominant strategy of all the players in the game. D. result in self-enforcing outcomes.