An asset is liquid if
A. it is backed by a government guarantee.
B. it can be exchanged for other items of value without high transaction costs.
C. it earns interest.
D. All of these are correct.
Answer: B
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Physical capital makes workers ________, so a declining capital stock ________
A) more productive; helps an economy grow B) less productive; helps an economy grow C) more productive; hinders economic growth D) less productive; hinders economic growth
Explain briefly what an "overvalued" currency is. Would you change your explanation depending upon whether or not there is central bank intervention or not? Discuss
What will be an ideal response?
When a perfectly competitive firm experiences positive economic profits in the short run
A. the high barriers to entry prevent further competition. B. existing firms exit the industry. C. new firms enter the industry. D. firms have no incentive to exit or enter the industry.
The firm in a perfectly competitive industry is a
A) price taker. B) price maker. C) price seeker. D) price dealer.