A production possibilities frontier (PPF) is characterized by increasing opportunity costs when
a. the PPF is a straight line
b. the PPF is bowed inward
c. the PPF is bowed outward
d. increasing opportunity costs do not occur with PPF's
c
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Which of the following statements is correct?
a. A large, well-known corporation such as Proctor and Gamble would generally use financial intermediation to finance expansion of its factories. b. On average, indexed funds outperform managed funds. c. Unlike corporate bonds and stocks, checking accounts are a store of value. d. Financial intermediaries are institutions through which savers can directly provide funds to borrowers.
What is the function of risk premium?
A. To compensate bondholders for the chance the borrower will not repay the loan. B. To raise the return to holding government bonds. C. To make sure that the value of the bond rises with inflation. D. To distinguish short from long-term bonds.
Acquired comparative advantage comes from factor endowments.
Answer the following statement true (T) or false (F)
Fiscal policy suffers from the problem of:
A. being slow to implement. B. being formulated and implemented by politicians subject to short-run incentives. C. being influenced by special interest groups. D. all of the answers given are correct.