Regulatory capture is said to have occurred when which of the following is true?
A. Rules and enforcement in an industry are heavily influenced by the industry being
regulated.
B. One firm controls an entire market, having captured customers away from other firms.
C. Government imposes excessive regulations in an industry, resulting in inefficiencies.
D. Consumers make all the rules for an industry, forcing firms into inefficient production
methods.
Answer: A
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If the Treasury prints currency to finance an expenditure, the impact on the money supply is similar to when the Treasury borrows from the
A) banking system when it is fully loaned-up. B) banking system when it has excess reserves. C) non-bank public. D) Federal Reserve.
Economic institutions like the Federal Reserve System of 1914 created by legislation are designed to:
(a) Only achieve economic goals (b) Garner votes (c) Satisfy the well organized interests of special groups (d) All of the above
Economies of scale and Increasing Returns to Scale are the same thing looked at from either the production or cost perspective
Indicate whether the statement is true or false
If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be
A. a negatively sloped straight line. B. negatively sloped and "bowed inward" toward the origin. C. negatively sloped and "bowed outward" from the origin. D. a positively sloped straight line.