From a psychological point of view, could we talk ourselves out of a recession simply by having business and government leaders express optimistic statements?
What will be an ideal response?
Probably not because talk has to be followed up by actions. However, if investors and consumers have a general feeling that economic conditions are not so bad or are going to get better, it could encourage consumption and investment spending.
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The effectiveness with which markets bring buyers and sellers together is called
A) pricing efficiency. B) operating efficiency. C) the theory of efficient markets. D) bid-asked spread efficiency.
In an indefinitely repeated game, a firm might use a ________ to ________ a rival that defects from a cooperative strategy
A) trigger strategy; threaten B) trigger strategy; punish C) legal maneuver; sue D) tacit threat; dissuade
Suppose the quantity of bonds demanded exceeds the quantity supplied at a given interest rate. What will happen to restore equilibrium?
a. Bond prices will increase and the interest rate will rise. b. Bond prices will decrease and the interest rate will fall. c. Bond prices will increase and the interest rate will fall. d. Bond prices will decrease and the interest rate will rise. e. Bond prices will increase and the interest rate will stay the same, as bond prices are independent of the interest rate.
Supply is said to be inelastic if the quantity supplied responds substantially to changes in the price and elastic if the quantity supplied responds only slightly to price
a. True b. False Indicate whether the statement is true or false