To economists, games are:
A. just recreational pursuits like chess, Monopoly, or poker.
B. any situation in which players pursue strategies designed to achieve their goals.
C. situations in which individuals act against their own interest for fun.
D. None of these statements are true.
B. any situation in which players pursue strategies designed to achieve their goals.
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The Coase Theorem works best in places that transaction costs for contracts among people is low. Often in the world of torts and externalities both parties can claim that they have rights to impose on others. One case is that of a railroad that is noisy and scares the cattle and the rancher whose cattle sometimes wander in front of moving trains causing damage to them and the train. What does the
Coase say would happen? a. The train should have property right to be safe from wandering cattle, and the rancher should be liable for train damage of rampaging cattle. b. The rancher should have the property right to be safe from noisy trains, and the railroad should be liable for weight loss of cattle from train whistles and rumbling noise. c. If transaction costs are low, the efficient activity will occur, either the rancher or railroad installing fences to protect from rampaging cattle and/or sound insulation with trees, or if it is cheaper, fewer train trips per day. The cheapest or most efficient solution will happen, regardless of who is assigned the original property right.
Demand for a necessity, such as food, is
a. both income and price inelastic b. income inelastic and price elastic c. income elastic and price inelastic d. both income and price elastic e. income elastic and perfectly price inelastic
The Clayton Act allowed board members of one corporation to sit on the board of a competing firm as long as inside information was not transmitted
a. True b. False Indicate whether the statement is true or false
The Federal Reserve makes decisions regarding:
A. fiscal policy only. B. structural policy only. C. monetary and fiscal policy. D. monetary policy only.