Private entrepreneurs are likely to make better investment decisions than central planners because
A) failure of a government project will reduce the personal wealth of the planners involved in the decision.
B) the entrepreneurs can often turn a project's failure into a request for additional funding to rectify the "problem".
C) the entrepreneurs seek ever larger budgets, while planners will be more focused on cost reductions and efficiency.
D) the entrepreneurs who make mistakes must bear the costs of these mistakes
D) the entrepreneurs who make mistakes must bear the costs of these mistakes
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At the federal funds market equilibrium,
A) both the federal funds rate and the total quantity of reserves tend to rise automatically. B) both the federal funds rate and the total quantity of reserves tend to fall automatically. C) the equilibrium quantity of reserves demanded is equal to the equilibrium quantity of reserves supplied by the Fed. D) the equilibrium quantity of reserves demanded exceeds the equilibrium quantity of reserves supplied by the Fed.
Jane started eating more junk food and taking less care of her health after she bought life insurance. Her behavior is an example of ________
A) moral hazard B) adverse selection C) the paradox of thrift D) the free-rider problem
Which of the following is a disadvantage of the U-form structure?
a. In case of multiple products sold in different markets, a U-form structure is difficult to maintain. b. A U-form structure requires a larger staff to evaluate top-level decision making than other organization structures. c. A U-form structure necessitates a multiple-level decision-making process. d. The amount of information that is considered for decision-making in a U-form structure is less than other structures.
Assume there is a price ceiling imposed on a good which is below the equilibrium price. Which of the following changes would reduce the size of the shortage?
a. an increase in demand b. a decrease in demand c. a decrease in supply d. a lower price ceiling