What, according to Akerlof, causes the price difference between a one-year old used car and an unsold car manufactured by the same company in the same year?
What will be an ideal response?
According to Akerlof, the price difference between a one-year old used car and an unsold car manufactured by the same company in the same year is not entirely due to wear-and-tear. Buyers of used cars are worried about the hidden characteristics of the car known only to the seller. Therefore, they are not ready to pay a high price for such cars.
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The U.S. economy is experiencing falling output, falling employment, falling incomes and rising unemployment. These conditions best describe a business cycle ________
A) peak B) expansion C) recession D) trend E) trough
If a bank has ________ rate-sensitive assets than liabilities, then ________ in interest rates will increase bank profits
A) more; a decline B) more; an increase C) fewer; an increase D) fewer; a surge
"Private costs are borne by individuals while social costs are borne by society." Do you agree or disagree? Why?
What will be an ideal response?
Which of the following statements is false?
A) Private equity firms often need to borrow the money needed to buy a public corporation. B) Once a private equity firm owns a formerly publicly held corporation, they tend to cut costs and enhance efficiency. C) Critics of private equity firms say that companies that have too much cash and too little debt become targets for private equity firms to buy. D) A private equity firm is a group of investors that takes a privately held corporation and uses an investment banker to turn it into a publicly held corporation.