Institutions that borrow money from savers to lend to borrowers are known as
A) financial markets.
B) bond brokers.
C) financial intermediaries.
D) asset exchanges.
C
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According to your text, economic theory developed to answer which question?
A) Why does man have the will to power? B) Can we create a government strong enough to tie its own hands? C) How are countless individuals led to do "the right thing" without ever caring about doing good? D) Is greed good?
When the consumer is at his or her best affordable consumption point, it is the case that the marginal rate of substitution is
A) greater than the price ratio. B) equal to the price ratio. C) less than the price ratio. D) maximized.
All used cars are lemons or peaches. Owners know whether or not their car is a lemon, but buyers do not; that is, the quality of a car is private information. There are many more buyers than sellers
Buyers value a peach at $4,000 and a lemon at $200; owners value a peach at $3,000 and a lemon at $100 . Owners can have their cars inspected for $100 . If they do have their car inspected, they will receive a certificate that shows whether the car is a lemon or a peach. Show that owners of peaches will have their cars inspected and will sell those cars for $4,000 . Show also that the owners of lemons will not obtain a certificate and will sell their cars for $200 .
Points that lie below the production possibilities curve are inefficient because:
A. producing more of one good means producing less of the other. B. more of one good could be produced without producing less of the other. C. producers face scarcity. D. too many goods are being produced.