A finitely repeated game differs from an infinitely repeated game in that:
A. a collusive outcome can usually be sustained in the former but not the latter.
B. there is an end-of-period problem for the former.
C. the former needs a lower interest rate to support collusion than the latter needs.
D. all of the statements associated with this question are correct.
Answer: B
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Everything else held constant, a decrease in holdings of excess reserves will mean
A) a decrease in the money supply. B) an increase in the money supply. C) a decrease in checkable deposits. D) an increase in discount loans.
A potential money multiplier of 10 means that
a. excess reserve requirements are 90 percent b. a new deposit of $1,000 results in new demand deposits of $10,000 c. the legal reserve requirement is 10 percent d. there can be no more lending available e. the initial deposit must necessarily be $10
A quota brings a more serious misallocation of resources than a tariff
a. True b. False Indicate whether the statement is true or false
Discuss the three ranges of the aggregate supply (AS) curve. What could cause the AS curve to shift to the left? What impact would a leftward shift of the AS curve have on the economy?
What will be an ideal response?