Assuming perfect perfect capital mobility, the BP schedule is
a. vertical.
b. horizontal.
c. upward sloping.
d. downward sloping.
e. flat.
B
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When the housing bubble began to burst in 2006, investors became
A) more likely to purchase mortgage-backed securities since mortgage values had declined significantly, making the securities a better value. B) less likely to purchase mortgage-backed securities since the default rate on mortgages began to rise. C) more likely to purchase mortgage-backed securities since the higher rate of return made these investments much more profitable. D) less likely to purchase mortgage-backed securities since the government virtually took over the mortgage market.
Which of the following best represents the effects of a decrease in the price of tomato juice, other things being equal?
a. An upward movement along the demand curve for tomato juice. b. A downward movement along the demand curve for tomato juice. c. A rightward shift in the demand curve for tomato juice. d. A leftward shift in the demand curve for tomato juice.
Fixed prices in a free-market economy can increase efficiency.
Answer the following statement true (T) or false (F)
Answer the following statement(s) true (T) or false (F)
1. A sandwich is an example of a club good. 2. Asymmetric information means both parties in a transaction share the same knowledge. 3. Used car sellers are at an advantage over buyers. 4. In adverse selection, one party takes advantage of knowing more than the other. 5. When one party in a sale is dishonest with the other, it is called moral hazard.