Changes in the federal funds rate:
A) change the long-run expected interest rates in the same direction.
B) change the long-run expected interest rates in the opposite direction.
C) can change the long-run expected interest rate either in any direction depending on the magnitude of the change in the federal funds rate.
D) have no effect on the long-run expected interest rate.
A
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Suppose price increases from $7.00 to $13.00. Using the mid-point formula, the percentage change in price is:
A. .0.6 = 60 percent. B. 0.6 = 60 percent. C. 70 percent. D. 130 percent.
A tax on gasoline is likely to
a. cause a greater deadweight loss in the long run when compared to the short run. b. cause a greater deadweight loss in the short run when compared to the long run. c. generate a deadweight loss that is unaffected by the time period over which it is measured. d. none of the above is correct.
The logic of collective action explains the persistence of tariffs and quotas as an outcome that is driven by the asymmetry between
A. the benefits distributed across many consumers versus the concentration o f the costs in the hands of a few firms. B. the benefits distributed across many firms versus the concentration of the costs in the hands o f a few consumers. C . the benefit s concentrated in the hands of the few consumers, versus the costs distributed across many firms. D. the benefits concentrated in the hands o f the few firms, versus the costs distributed across many consumers.
A cooperative equilibrium results when firms
A) choose the best strategy regardless of what other players do. B) choose the strategy that maximizes the total game payoff. C) choose the strategy that minimizes the payoff to other players. D) choose a strategy by random chance.