If crop dusting on your farm causes your neighbors to have sore throats, then crop dusting is creating
A) only explicit costs.
B) opportunity costs.
C) external costs.
D) internal costs.
Answer: C
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"The deadweight loss of a monopoly equals the monopoly firm's profits." Do you agree or disagree? Why?
What will be an ideal response?
In its conduct of open market operations, the Fed now buys and sells
a. only U.S. government securities. b. only mortgage-backed securities issued by large investment banks. c. a wide range of assets including the stock shares of large banks, domestic automobile manufacturers, and high-technology business firms. d. a wide range of assets including corporate bonds and mortgage-backed securities.
Other things the same, an increase in the price level induces people to hold
a. less money, so they lend less, and the interest rate rises. b. less money, so they lend more, and the interest rate falls. c. more money, so they lend more, and the interest rate falls. d. more money, so they lend less, and the interest rate rises.
According to the Kahneman-Tversky value function,
A. small gains should be combined with large gains. B. small gains should be subtracted from large losses. C. small gains should be segregated from large losses. D. small losses should be segregated from large losses.