Insurance companies perform all of the following functions performed by financial intermediaries except:
A. pooling the resources of small savers.
B. transferring risk.
C. supplying liquidity.
D. making large investments.
Answer: C
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In a(n) __________ insurance policy, the savings component is allocated among a menu of investment options
A) whole B) term C) universal D) variable
In studying oligopolistic markets, economists assume that
a. there is no conflict or tension between cooperation and self-interest. b. it is easy for a group of firms to cooperate and thereby establish and maintain a monopoly outcome. c. each oligopolist cares only about its own profit. d. strategic decisions do not play a role in such markets.
Based on the given figure, the economy is initially in long-run equilibrium at point A. If there is a favorable supply shock that increases potential output and shifts the long-run aggregate supply curve from LRAS to LRAS', then there is initially ________ gap and the short-run aggregate supply curve will ________.
A. an expansionary; eventually shift to SRAS" B. a recessionary; eventually shift to SRAS" C. an expansionary; eventually shift to SRAS' D. a recessionary; eventually shift to SRAS'
Which government program would be considered an "entitlement" program?
A) national defense B) subsidies for mass transportation C) law enforcement in major U.S. cities D) Social Security