If, in a competitive market, marginal benefit is less than marginal cost
A) the government must force producers to raise prices in order to achieve economic efficiency.
B) the output is greater than the equilibrium quantity.
C) the output is less than the equilibrium quantity.
D) the net benefit to consumers from participating in the market is less than the net benefit to producers.
B
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Which of the following would not be considered a boom period as measured by the percentage growth rate of U.S. output of goods and services?
A. the Roaring 20s B. the conversion from a wartime to a peacetime economy following World War II C. World War II D. the late 1990s
There is a federal budget deficit when
A) the government spends more that it collects in taxes. B) the government spends less that it collects in taxes. C) the government spends the same amount it collects in taxes. D) taxes are too high.
Assume that initially, the risk premium, ? = 0 and that the domestic and foreign interest rates are given by R = .06, R* = .05
Suppose that the risk premium depends linearly on the difference between domestic government debt, B, and domestic assets of the central bank, A, i.e., ? = Find the new domestic interest rate if a sterilized purchase of foreign assets adjusts A s.t. (a) B - A = -.01/ (b) B - A = .01/ (c) B - A = .03/
Everything else held constant, when bonds become less widely traded, and as a consequence the market becomes less liquid, the demand curve for bonds shifts to the ________ and the interest rate ________
A) right; rises B) right; falls C) left; falls D) left; rises