An asset price bubble occurs when the prices of some assets rise far above their fundamental values.
Answer the following statement true (T) or false (F)
True
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Because a monopolistic competitor has some monopoly power, advertising to increase that monopoly power makes sense as long as:
A. the marginal cost of advertising is positive. B. the marginal cost of advertising exceeds the marginal benefit of advertising. C. the marginal benefit of advertising is positive. D. the marginal benefit of advertising exceeds the marginal cost of advertising.
If the September 11th terrorist attacks had not occurred, it is unlikely that the war in Iraq would have
A. been so protracted. B. uncovered so many weapons of mass destruction. C. divided Congress as it did. D. occurred at all.
Commercial banks create new money:
A. by issuing checks. B. when they increase their desired reserve/deposit ratio. C. when they buy government bonds from the Federal Reserve. D. through multiple rounds of lending.
If salt has a ________, then ________ pay most of any tax levied on salt
A) high elasticity of supply; sellers B) low elasticity of demand; buyers C) high elasticity of demand; buyers D) low elasticity of supply; buyers