Answer the following statements true (T) or false (F)
1) A system of fixed exchange rates is more likely to result in exchange controls than is a system of flexible (floating) exchange rates.
2) A nation that imports more goods and services than it exports is necessarily realizing an
international balance of payments deficit.
3) The United States has had significant trade and current account surpluses in recent years.
4) A current account deficit will reduce U.S. foreign indebtedness.
1) T
2) F
3) F
4) F
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The Coase Theorem asserts that government intervention is a prerequisite for addressing externality problems
Indicate whether the statement is true or false
An oligopsony exists when
a. a few sellers dominate a market. b. a few buyers dominate a market. c. a single buyer dominates a market. d. a single seller dominates a market.
Which of the following practices of insurers deter moral hazard?
a. Setting a uniform premium structure. b. Requiring people to purchase the same coverage. c. Arranging for reinsurance to cut the risk of unexpectedly large claims. d. Conducting security checks without notice and terminating the policy whenever required.
The dire predictions about the underfunded nature of Social Security, Medicare, and state and local pensions could be wrong because
A. interest rates may turn out to be higher in the future. B. unemployment rates may turn out to be higher than they are currently predicted to be. C. taxable incomes may turn out to be higher than they are currently predicted to be. D. taxable incomes may turn out to be lower than they are currently predicted to be.