Assuming that transactions costs are sufficiently low, the Coase theorem results in the economic pie being maximized. What impact do legal constraints have on this prediction of the Coase theorem?
What will be an ideal response?
Legal restraints will not affect the total amount of income, but they will affect the shares of that income that go to each party to the transaction.
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The economist George Stigler offered support for the Sherman Act when he said
A) competition can only be preserved by protecting competitors from cutthroat competition. B) conglomerate mergers could not be prevented or regulated if it were not for the Sherman Act's prohibition of combinations in restraint of trade. C) predatory pricing costs businesses more than it saves consumers. D) the ghost of Senator Sherman is an ex officio member of the board of directors of every large company. E) the Sherman Act is essential if the Clayton act is to be enforceable in any way.
International reserves are
a. foreign exchange held by governments only b. foreign exchange held by central banks only c. foreign exchange held by governments or central banks d. gold only e. various internationally acceptable assets
Stagflation can be defined as a combination of ____.
A. economic migration and inflation B. economic aggregation and deflation C. economic stagnation and inflation D. economic aggregation and inflation
If a bond's rating improves, we would expect:
A. the demand for and the yield of this bond to increase, all other factors constant. B. both the demand for and the price of the bond to decrease, all other factors constant. C. the demand for this bond to increase, all other factors constant. D. the demand for this bond to decrease, and its yield to increase, all other factors constant.