If Best Beds, Bedding R Us, and Sleepy Beds are all competing in the bedding market and Best Beds consistently is the first to change prices, Best Beds might be ________.
A) signaling to the other firms to consistently raise their prices
B) signaling to the other firms to consistently lower their prices
C) signaling to the other firms to consistently maintain their prices
D) offering to be the price leader
D) offering to be the price leader
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Macland is going through a recession, and its government is borrowing 1 billion dollars to increase government spending and stimulate the economy. This has increased the interest rate, decreasing the number of private investors. What is this situation in investments called?
a. crowding out b. expansionary fiscal policy c. liquidity trap d. interest rate appreciation
When measuring the risk of an asset:
A. one cannot use other investments to evaluate the asset's risk. B. it is necessary to incorporate uncertainties that are not quantifiable. C. one must remember that the concept of risk applies only to financial markets, not to financial intermediaries. D. one must measure the uncertainty about the size of future payoffs.
An efficient outcome can always be reached by requiring the individual who produces the externality to fully compensate individuals for any damage inflicted.
Answer the following statement true (T) or false (F)
“If economic forecasting was a more exact science, the business cycle could be entirely corrected by fiscal measures.” Do you agree?
What will be an ideal response?