In setting premiums, insurance firms face which of the following problems?
a. It is difficult to assign individuals to the correct demographic group.
b. Individuals do not want to pay a high premium if that matches their demographic group.
c. Individuals do not always have the same characteristics as their demographic group.
d. It is difficult to determine premiums for each demographic group.
c. Individuals do not always have the same characteristics as their demographic group.
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Inflation usually increases during a recession and decreases during an expansion
Indicate whether the statement is true or false
Which of the following most accurately states the function of middlemen?
a. Middlemen reduce transaction costs. b. Middlemen add to the expense of buyers and sellers without providing any benefit. c. Our economy would work just as well without middlemen since they do not expand the availability of physical goods. d. Middlemen reduce the number of transactions since they increase the buyer's price and reduce the seller's net receipts.
When demand is inelastic, an increase in price will cause
a. an increase in total revenue. b. a decrease in total revenue. c. no change in total revenue but an increase in quantity demanded. d. no change in total revenue but a decrease in quantity demanded.
What was the response to Germany's expansionary fiscal policy from the German central bank, the Bundesbank?
A) It expanded the money supply to ease rates of interest. B) It made no policy changes. C) It contracted the money supply and raised interest rates. D) It began the process of reverting to a gold standard.