According to the economic way of thinking, it is efficient to support a system of law and order through taxation because
A) we need law and order.
B) law and order are not free goods.
C) law and order create significant spillover benefits.
D) citizens ultimately despise law and order.
C
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John's utility of wealth curve is shown in the above figure. He currently has total wealth of $20,000. If there is a 50 percent chance that his $10,000 car will be stolen, then his expected wealth equals
A) $0. B) $10,000. C) $15,000. D) $20,000.
The efficiency
A) gain from a fixed exchange rate with the euro is smaller when trade between say, Norway and the euro zone, is extensive than when it is small. B) gain from a fixed exchange rate with euro is greater when trade between say, Norway and the euro zone, is extensive than when it is small. C) loss from a fixed exchange rate with the euro is smaller when trade between say, Norway and the euro zone, is extensive than when it is small. D) gain from a fixed exchange rate with euro is the same as when trade between say, Norway and the euro zone, is extensive than when it is small. E) gain from a fixed exchange rate with euro is the same as when trade between say, Norway and the euro zone, is small than when it is small.
The S&L Crisis can be analyzed as a principal-agent problem. The agents in this case, the ________, did not have the same incentive to minimize cost to the economy as the principals, the ________
A) politicians/regulators; taxpayers B) taxpayers; politician/regulators C) taxpayers; bank managers D) bank managers; politicians/regulators
In the early 1930s, the currency-deposit ratio rose, as did the level of excess reserves. Money supply analysis predicts that, everything else held constant, the money supply should have
A) risen. B) fallen. C) remain unchanged. D) either risen, fallen, or remain unchanged.