A public good is nonrivalrous and excludable
a. True
b. False
Indicate whether the statement is true or false
False
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Which of the following was the main reason for increased counterparty risk in the shadow banking system prior to the financial crisis of 2007-2009?
A) increased leverage B) government insuring money market deposits C) many firms borrowing long term for short-term investments D) trading of derivatives on exchanges
Suppose you borrow $2,000 for one year and at the end of the year you repay the $2,000 plus $110 of interest. The expected inflation rate was 2.2% at the time you took out the loan, but the actual inflation rate turned out to be 3.3%
What was the actual real interest rate you paid? A) 2.2% B) 3.3% C) 5.5% D) 8.8%
Which of the following would not lead to higher concentration in an industry?
A. A large number of firms have entered the market. B. Some firms have become technologically superior. C. Larger firms gain control of important resources, squeezing out smaller firms. D. Innovation increases plant size of some firms and lowered their average costs.
During the 1992 presidential campaign, H. Ross Perot made much of the various “special interests” which lobby in Washington, D.C. How might an economist view this? Which specific market breakdown may occur if there is lobbying? Relate your answer to the study of monopoly and oligopoly.
What will be an ideal response?