When crowding out occurs in an economy, it can reduce expenditures for
A. business investments.
B. both consumer purchases and business investments.
C. consumer purchases.
D. government purchases.
Answer: B
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A cake is to be shared by two people. Both desire the largest piece possible. One of the two will cut the cake. Under which of the following situations will the cutter adopt a Rawlsian social welfare function?
A) The person cutting the cake chooses the first piece. B) The person not cutting the cake chooses the first piece. C) The two individuals will bid for the right to cut the cake and choose first. D) The two individuals will toss a coin for the right to cut the cake and choose first.
In a principal/agent relationship, _____ can help to reduce the damage caused by a winner's curse, provided both the parties are well-informed
a. signals b. warranties c. disclosure d. renegotiation
According to the equation of exchange, a contractionary monetary policy must be adopted to offset any decrease in the velocity of money
a. True b. False Indicate whether the statement is true or false
The United States is an example of a mixed economy
a. True b. False Indicate whether the statement is true or false