You have just noticed that the dollar appreciated and you suspect that U.S. policymakers were behind this change. Which would you choose as the most likely cause of this appreciation in the real exchange rate?
A) An increase in the money supply
B) A decrease in the money supply
C) A temporary increase in government purchases
D) A temporary decrease in taxes
B
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Refer to A Negative Externality Problem. Suppose there is no attempt to internalize the externality. Pigovian analysis indicates that the externality creates a deadweight loss equal to
Demand for a good is given by Q = 100 - P. The private marginal cost of production is MCP = 10 + Q. There is a $10 per unit negative production externality in this situation. a. $0 b. $25 c. $50 d. $100
Which of the following is a problem with the price system that can lead to fluctuations in output?
A) The price system works silently in the background. B) Prices may be flexible. C) Prices can be slow to adjust. D) all of the above
A major problem of owning a corporation is unlimited liability.
Answer the following statement true (T) or false (F)
Banks require collateral for loans in order to
A) ensure that borrowers have significant amounts of their own funds invested in their businesses. B) charge higher interest rates on loans. C) reduce their tax liability on the interest they collect on loans. D) reduce the total amount they are obliged to lend to any one borrower.