Firms are more likely to avoid a prisoners' dilemma when they interact repeatedly than when they rarely interact.
Answer the following statement true (T) or false (F)
True
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Assume that the Fed knows a demand shock has occurred in the economy. It takes the Fed 2 months to adjust policy to the shock, and it takes the economy 14 months for the policy change to affect the economy
The 2 month time period refers to the ________, and the following 14 month time period refers to the ________. A) policy lag; implementation lag B) recognition lag; implementation lag C) implementation lag; impact lag D) policy lag; recognition lag
If the AS curve is upward-sloping, the government alone should raise its purchases by the amount of the AD shortfall in order to reach full-employment equilibrium.
Answer the following statement true (T) or false (F)
What is a surplus? What is a shortage?
What will be an ideal response?
At Tony's Car Wash, a team of four workers washes and rinses each car by hand, and one worker dries the car by hand. Which of the following is true?
a. Tony will have no principal-agent problems. b. Tony will have more principal-agent problems in washing and rinsing than in drying the cars. c. Tony will have more principal-agent problems in drying than in washing and rinsing the cars. d. Tony will be awash in severe principal-agent problems. e. Tony will have no incentive to monitor the car wash.