Suppose the world price of a television is $300 . Before Paraguay allowed trade in televisions, the price of a television there was $350 . Once Paraguay began allowing trade in televisions with other countries, Paraguay began
a. importing televisions and the price of a television in Paraguay decreased to $300.
b. importing televisions and the price of a television in Paraguay remained at $350.
c. exporting televisions and the price of a television in Paraguay decreased to $300.
d. exporting televisions and the price of a television in Paraguay remained at $350.
a
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A good is nonrivalrous in consumption if
A. its consumption by one person does not reduce its consumption by others. B. its consumption by one person reduces its consumption by others. C. it is possible, or not prohibitively costly, to exclude someone from receiving the benefits of the good once it has been produced. D. it is impossible, or prohibitively costly, to exclude someone from receiving the benefits of the good once it has been produced. E. a and d
By bundling share purchases of many investors together mutual funds can take advantage of economies of scale and thereby lower
A) adverse selection. B) moral hazard. C) transactions costs. D) diversification.
Direct financing is distinguished from indirect financing because:
a. Direct financing is when a business borrows directly from pooled funds at a financial institution, and indirect financing is when it borrows in the bond or stock market. b. Direct financing is when a company borrows in the fixed-rate market, and indirect financing is when it borrows in the floating-rate market. c. Direct financing is when a business borrows in the bond or stock market, and indirect financing is when it borrows from pooled funds at a financial institution. d. None of the above.
Situation 4-1 During the winter of 1973-74, a general system of wage and price controls (including a price ceiling on gasoline) was in force in the United States. At the beginning of 1974, some oil-producing countries imposed an oil embargo (a legal prohibition on commerce) on the West. In the spring of 1974, price controls were abolished. Refer to Situation 4-1. Before the oil embargo, the price
ceiling on gasoline had no noticeable effect on the market. What is the most likely explanation for this? A) The equilibrium price of gasoline was probably below the price ceiling. B) The demand curve for gasoline in the 1970s was vertical. C) The supply curve for gasoline in the 1970s was vertical. D) The equilibrium price of gasoline was probably above the price ceiling.