"Lender of last resort" means that the central bank
a. has to lend money to failing banks.
b. should lend money to individuals if their bankruptcy would threaten the banking system.
c. should lend money to banks that are suffering short-term liquidity shortages.
d. should lend money to pay for government deficits.
e. None of the above
C
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What is a Nash equilibrium? Is this equilibrium the best outcome for the players? Give an example
What will be an ideal response?
If Nike and Adidas are faced with the game in the figure shown, we can predict:
A. an outcome that is good for society and less than ideal for the companies.
B. an outcome that is less than ideal for society, but optimal for the companies.
C. that both will follow their dominant strategy and society will lose.
D. None of these is likely to happen.
Which factor of production receives the greatest share of the U.S. national income?
A. Land B. Labor C. Capital D. Entrepreneurship
Use the following graph for a pure monopoly operating in the short run to answer the next question.
At the profit-maximizing level of output, this firm ________.
A. faces a total fixed cost equal to the area of BEFC B. should shut down C. generates a loss per unit equal to DE D. generates an economic profit equal to the area of ABED