A derivative is a:
a. contract derived from a spot market rate.
b. fixed exchange rate.
c. flexible exchange rate.
d. contract between firms for foreign currency.
Ans: a. contract derived from a spot market rate.
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The imposition of a tax on a good enables the government to
A) raise the price received by sellers of the goods that have been taxed. B) lower the price paid by buyers for the goods that have been taxed. C) create a more efficient economic system. D) take part of consumer and producer surplus as tax revenue when the good is purchased. E) decrease the deadweight loss in this market.
Explain how efficiency wages, labor unions, and minimum wage laws affect labor markets
What will be an ideal response?
When the Fed sells government securities, it
a. lowers the cost of borrowing from the Fed, encouraging banks to make loans b. raises the cost of borrowing from the Fed, discouraging banks from making loans c. increases the amount of excess reserves that banks hold, encouraging them to make loans d. increases the amount of excess reserves that banks hold, discouraging them from making loans e. decreases the amount of excess reserves that banks hold, discouraging them from making loans
Which of the following is a similarity between an oligopoly and monopolistic competition? a. Both markets are characterized by mutually interdependent decision making. b. Both markets produce homogeneous products
c. Both markets are controlled by many dominant firms. d. Both markets have firms that compete for market share.