A quota refers to:
A) a tax on imported goods
B) a limit on the amount of a good that can be imported
C) the range within which an exchange rate is allowed to fluctuate
D) a limit on the size of a trade deficit
B
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As a "central bank," which of the following is TRUE regarding the Fed?
I. The Fed is a public authority that regulates the nation's banks. II. The Fed is not allowed to provide services to commercial banks like Citibank. III. The Fed is required to provide banking services to private citizens. A) I B) II C) I and II D) I and III
In which of the following situations is the principal-agent problem least likely to occur?
a. a hospital stay b. a doctor's visit c. a bartender serves you at the bar d. your TV is repaired e. a stockbroker calls with financial advice
The substitution effect occurs because when the price of one good increases, consumers will buy fewer substitute goods
a. True b. False Indicate whether the statement is true or false
Government failure describes a situation where government activity creates negative externalities
Indicate whether the statement is true or false