Individuals who face greater risks
a. are more likely to purchase insurance
b. are less likely to purchase insurance
c. are neither more nor less likely to purchase insurance
d. are risk neutral
a
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Financial markets pay close attention to changes in the federal funds rate because these changes ________.
A. indicate commercial bank lending policies B. indicate the Fed's plans for monetary policy C. directly affect the interest payments on the national debt D. directly affect a large volume of loans
Answer the following statements true (T) or false (F)
1. National income accountants eliminate double counting of intermediate goods by using only the value of final goods. 2. Current disposable income can be adjusted for price changes and population changes to yield real per capita disposable income. 3. A transfer payment is a payment of money in return for which no current goods or services are produced. 4. The value of leisure is not taken into consideration in GDP accounting. 5. When final sales are less than GDP, a net reduction in inventory has taken place.
A person has a comparative advantage in an activity whenever she
A. can perform the activity at a lower opportunity cost than another person can. B. can do the activity in less time than anyone else. C. has an absolute advantage in the activity. D. can do everything better than anyone else.
The result of market failure is waste or lost surplus.
Answer the following statement true (T) or false (F)