Other things equal, when U.S. money moves to other countries to take advantage of better foreign investment opportunities, then:
a. the U.S. money supply will increase.
b. the reserve requirement for U.S. banks will rise.
c. the U.S. money supply will decrease.
d. U.S. banks will have excess reserves to loan out.
e. the effect of the U.S. deposit expansion multiplier will be increased.
c
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Asarta Inc. is polluting into a nearby fishing; doing so benefits them $40,000 a year. The fishermen are unhappy as their trout are dying off. Typically, the fishermen can catch trout and sell it to a local market where they can earn about $8,000 a year. Currently, the fishermen have the rights to use the stream as they see fit. Which of the following is an optimal solution according to the Coase Theorem?
A. Asarta Inc. could pay the fishermen $8,500 and keep polluting B. There is no optimal solution given the current property rights C. The fishermen could pay Asarta Inc. $4,000 to stop them from polluting D. Asarta Inc. could pay the fishermen $7,000 and keep polluting
?Because trade across markets creates winners and losers,the overall surplus in the loser's market is diminished.
Answer the following statement true (T) or false (F)
A new car in the dealer's showroom had a sticker price of $35,900. Sally liked the car but decided she would pay no more than $32,000 for it, otherwise she would do without it. After haggling with the dealer, she purchased the car for $31,500
Did she gain any consumers surplus? If so, how much? If not, why not?
Based on the graph showing the crowding-out effect, how does the crowding-out effect influence the fiscal policy effect?
a. It decreases it by the difference between AD2 and AD3.
b. It increases it by the difference between AD1 and AD3.
c. It completely negates the fiscal policy effect.
d. It doubles the fiscal policy effect.