Government may not have an incentive to correct a market failure because:
A. the benefit of correcting the market failure might exceed the cost of correcting the market failure.
B. policy makers fear that intervention will lead to a Pareto optimal outcome.
C. government doesn't have the information it needs to correct the market failure.
D. government reflects politics, which reflects political pressure to benefit special interest groups.
Answer: D
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How does a cartel differ from an oligopolistic industry?
A. Oligopolistic industries cannot make economic profit. B. Cartels reduce uncertainty to maximize profits. C. Cartels are legal while oligopolies are illegal. D. Oligopolies face large amounts of competition while cartels do not.
An exchange rate regime in which the government may change the fixed rate in the face of a significant disequilibrium in the country's international position is called a(n)
A. managed float. B. adjustable peg. C. crawling pegged exchange rate. D. currency board.
How many Federal Reserve District Banks are there?
A. 24 B. 6 C. 1 D. 12
The labor market for teachers in a small, isolated community that has one school district would be best described as a(n):
A. Natural monopoly B. Bilateral monopoly C. Monopsony D. Oligopsony