Suppose you have money to lend, but will do so only if you are compensated for the risk of default. If you set a high interest rate on your loan, a likely consequence is that ________
A) safe borrowers will look elsewhere, and only risky borrowers will find your terms attractive
B) risky borrowers will look elsewhere, so your money is more likely to go to a safe borrower
C) competition from other lenders will force you to lower your interest rate
D) you will be prosecuted for predatory lending
A
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A monopoly's output decision depends only on the shape of its marginal cost curve
Indicate whether the statement is true or false
________ is the general resistance to change, often stemming from loss aversion.
A. Anchoring and adjustment B. Regression to the mean C. Status quo bias D. The present aim standard of rationality
The marginal propensity to save is the change in saving divided by the change in:
a. Consumption b. Investment c. Income d. Debt
The marginal revenue product (MRP) of land declines as more land is brought into use. As a result the:
A. demand curve for land is downsloping. B. demand curve for land is upsloping. C. supply curve for land is downsloping. D. supply curve for land is upsloping.