According to Ronald Coase, allocation of resources in a free-market economy will be efficient as long as
A. property rights are clearly assigned and can be enforced with low contracting costs.
B. property rights are assigned only to the rich.
C. property rights are clearly assigned but not enforced.
D. contracting costs are sufficiently high.
Answer: A
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In order to reduce labor supply, a union must be able to
a. do all of the following b. force all employers in the industry to hire only union members c. set wages d. agree to wage concessions e. increase union membership
Wealth is redistributed from debtors to creditors when inflation was expected to be
a. high and it turns out to be high. b. low and it turns out to be low. c. low and it turns out to be high. d. high and it turns out to be low.
According to the expectations hypothesis:
A. when short-term rates are expected to remain constant in the future, the long-term interest rates are higher than current short-term interest rates. B. expectations of future short-term rates equal estimates of current short-term rates. C. short-term bonds are perfect substitutes for long-term bonds. D. when short-term interest rates are expected to rise in the future, the long-term interest rates are equal to current short-term interest rates.
If the government removes a binding price ceiling from a market, then the price received by sellers will
a. decrease, and the quantity sold in the market will decrease. b. decrease, and the quantity sold in the market will increase. c. decrease, and the quantity sold in the market will increase. d. increase, and the quantity sold in the market will increase.