The Lerner Index is a measure of market power that focuses on:
A) the ratio of the price of a firm's product to the price elasticity of demand for the product.
B) the share of the market controlled by the X largest firms in the market.
C) the sum of the squares of the market share of each firm in an industry.
D) the difference between a firm's product price and its marginal costs of production.
D
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An increase in the real interest rate, all other things held constant, will cause a country's ________ to ________
A) current consumption: increase B) current consumption: decrease C) terms of trade; improve D) terms of trade; worsen E) welfare level; improve
One intention of deposit insurance is to reduce the danger of
A. excess lending. B. excess profits. C. risky lending. D. bank runs. E. All of these responses are correct.
"Quantitative easing" is when:
a. Lending rules and underwriting standards are relaxed, which often leads to speculation. b. Increasing a nation's money supply even though interest rates appear to be at a minimum. c.Increasing government spending and reducing taxes even though they do not appear to be increasing aggregate demand. d. All of the above.
Suppose there is a decrease in the confidence that workers have in their future employment and income. This will cause
A. a decrease in borrowing, which will decrease interest rates. B. a decrease in saving, which will decrease interest rates. C. a decrease in saving, which will increase interest rates. D. a decrease in borrowing, which will increase interest rates.