A bakery can produce either cakes or cookies. If the price of cookies rises, then
A) the supply curve of cake shifts leftward.
B) the supply curve of cake shifts rightward.
C) there is a movement downward along the supply curve of cakes.
D) there is a movement upward along the supply curve of cakes.
A
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________ are asymmetric information problems that act as a barrier to efficient allocation of capital
A) Asset prices B) Credit imbalances C) Financial frictions D) Financial derivatives
A policy in which the money supply is kept growing at a constant rate regardless of the state of the economy is
A) a Taylor rule. B) a discretionary policy. C) a policy rule advocated by monetarists. D) advocated by activists.
What are the conditions for price discrimination?
Government spending that shifts income from one group of society to another, such as price subsidies and cash payments, is known as
a. merit goods spending b. debt servicing c. transfer payments d. countercyclical payments e. social spending