The liquidity of an asset indicates:
a. its buying power
b. the ease with which it can be converted into cash without a significant loss of value.
c. the ease with which it can be converted into another asset.
d. how likely people are to trade it internationally.
e. its intrinsic value.
b
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If a firm's marginal costs ________ then its ________
A) fall; best-response curve shifts B) rise; forced out of the oligopoly C) rise; output increases D) fall; price falls
Helen gives up the opportunity to bake 40 cakes for each room she paints; Josh can paint one room in the time it takes him to bake 60 cakes. The opportunity cost of a cake for Helen is
a. painting one room b. painting 1/40 of a room c. painting 1/60 of a room d. painting 2/3 of a room e. painting 3/2 of a room
According to the crowding-out view, budget deficits will:
A. reduce interest rates. B. increase interest rates and retard private investment. C. reduce the investments of foreigners in the United States. D. increase the capital stock available to future generations.
Using a supply and demand graph, illustrate the market for rent-controlled apartments with the following data:
Equilibrium rent without rent control: $1,500 Rent with rent control: $700 Quantity of apartments demanded with rent control: 50,000 Quantity of apartments supplied with rent control: 20,000 What is the value of the initial shortage of apartments with rent control? Now assume rent control leads to a reduction in the supply of apartments, and the new quantity supplied is now 15,000. Illustrate this on your graph. What is the value of the shortage of apartments following the decrease in supply? What will be an ideal response?