Which of the following are risks for multinational corporations but not risks for domestic corporations?
A) changes in government rules and regulations
B) capital controls
C) changes in tax laws
D) government red tape and corruption
B
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When weighing the efficiency of monopolistic competition, which of the following should be considered?
i. The information provided by advertising ii. Product variety iii. The extra cost of excess capacity A) ii only B) i and iii C) ii and iii D) i, ii, and iii E) iii only
The government wishes to close an inflationary gap by reducing real GDP by $400 billion. Assuming a tax multiplier of 4 and an income multiplier of 5, which of the following policy prescriptions would reduce the inflationary gap by $400 billion?
a. Decreasing government spending by $400 billion and increasing taxes by $400 billion. b. Decreasing government spending by $160 billion and decreasing taxes by $100 billion. c. Decreasing government spending by $40 billion and decreasing taxes by $40 billion. d. Decreasing government spending by $80 billion and keeping taxes the same. e. Doing absolutely nothing to the economy.
The similarity between markets for common resources and markets with externalities is that:
A. generally we get an oversupply at market. B. the price that competitive firms charge does not capture the true costs and benefits of consumption. C. the equilibrium quantity is too high in terms of society. D. government involvement is needed to reach an efficient outcome.
Purposeful behavior means that:
A. people are selfish in their decision making.
B. people weigh costs and benefits to make decisions.
C. people are immune from emotions affecting their decisions.
D. decision makers do not make mistakes when weighing costs and benefits.