What are the pros and cons of a competitive market in the long run?
What will be an ideal response?
The pros include price equals minimum average total costs and marginal cost. Also, only a normal profit is earned in the long run. The major drawback of a competitive market is that it usually does not promote technological advances (because competitive firms do not earn the profits necessary to enable long-term investments in research and development).
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The money supply can be increased by decreasing the required reserve ratio.
Answer the following statement true (T) or false (F)
Explain why international capital markets have expanded since the 1980s
What will be an ideal response?
When I purchase a corporate ________, I am lending the corporation funds for a specific time. When I purchase a corporation's ________, I become an owner in the corporation
A) bond; stock B) stock; bond C) stock; debt security D) bond; debt security
The difference between net public debt and gross public debt is
A) all government interagency borrowing. B) the interest paid annually on the public debt. C) the amount owed to individuals and firms outside the United States. D) the current year's budget deficit from the amount of public debt at the start of the year.