Incentives for borrowers and savers in the loanable funds market are determined by the nominal interest rate as opposed to the real interest rate
a. True
b. False
Indicate whether the statement is true or false
False
You might also like to view...
Ray's Radios believed the synergies between radio production and battery production could be realized if he expanded. However, due to overseeing the battery expansion Ray devoted less time to the radio business leading to the radio unit costs increasing. At this point, Ray's Radios should
a. Increase production of the batteries b. Divest itself from the production of the batteries c. Shut down the production of the batteries d. None of the above
Under free trade, a large country produces one million leather bags per year and imports another two million bags per year at the world price of $60 per bag. Assume the country imposes a specific tariff of $5 per bag. As a result, the per-unit price of leather bags decreases to $58 in the international market and the import of leather bags drops to 1.6 million. The domestic production, on the other hand, increases to 1.1 million. Following the imposition of the tariff, the domestic consumers pay a price of ________ for each bag.
A. $65 B. $63 C. $60 D. $58
Which of the following is an assumption of the Cournot model?
A. The firms behave so as to maximize their revenues. B. There is only one firm in an industry. C. Each firm takes the output of the other firm as given. D. Firms collude to fix prices and quantities.
A cost or benefit resulting from some activity that is imposed or bestowed on third parties is
A. a public good. B. logrolling. C. a market failure. D. an externality.