Would a relatively high P/E ratio lead us to conclude that a stock is overvalued or undervalued? Why or why not?
If a stock's price to earnings ratio is higher than other firms in the industry, that stock could be considered overvalued. However, the higher ratio may be an indication that the market expects the company's performance to improve significantly in the future.
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An efficient allocation of labor occurs when the
A) marginal benefit to workers exceeds the marginal benefit to firms. B) marginal benefit to firms exceeds the marginal benefit to workers. C) marginal cost to workers is equal to the marginal benefit to firms. D) marginal cost and marginal benefit of both workers and the firms are equal to zero. E) marginal benefit of workers exceeds the marginal cost to firms by as much as possible.
In the late 1980s, ________ domestic private investment led to ________ in net foreign borrowing
A) higher, an increase B) higher, a decrease C) lower, an increase D) lower, a decrease
Explain the study of economics
What will be an ideal response?
Government failure
A. leads to a more efficient allocation of resources. B. leads to a less efficient allocation of resources. C. occurs because government officials do not act in their own self?interest. D. occurs because households or firms do not act in their own self?interest.