The risk premium of a financial asset is the:
A. additional price that must be paid for riskier investments.
B. rate that compensates for risk.
C. rate that compensates for the risk of inflation.
D. same as the discount rate.
B. rate that compensates for risk.
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In a common-value setting
a. Oral auctions tend to return higher prices b. Sealed bid auctions tend to return higher prices c. Vickery auctions tend to return higher prices d. Rotating bid auctions tend to return higher prices
Suppose a tax of $3 is imposed on each new garden hose that is sold, resulting in a deadweight loss of $22,500 . The supply curve is a typical upward-sloping straight line, and the demand curve is a typical downward-sloping straight line. Before the tax was imposed, the equilibrium quantity of garden hoses was 100,000 . We can conclude that the equilibrium quantity of garden hoses after the tax
is imposed is a. 75,000. b. 85,000. c. 90,000. d. 95,000.
Which of the following statements is true?
A. Corner solutions always satisfy the tangency condition. B. Interior solutions may or may not satisfy the tangency condition. C. Interior solutions always satisfy the tangency condition. D. Whenever the consumer purchases good X but not good Y, then MRSXY ? PX/PY at the chosen bundle.
In the economy of Talikastan in 2015, consumption was 75% of GDP, government purchases were $200, imports were $50 and 125% of the value of exports, investment was one-sixth of the value of consumption. What was Talikastan's GDP in 2015?
a. $218 b. $2500 c. $1520 d. $2100