The free-rider problem refers to those who ride on public transit systems without paying.
Indicate whether the statement is true or false.
Ans: False.
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A reduction in the ratio of the money supply to GDP is
a. financial deepening b. inflation c. financial repression d. real interest rate e. none of the above
Why doesn't the process of electing officials prevent rent-seeking and corruption?
A. The cost of gathering such information is often too costly. B. Those who win special favors through this behavior simply pay others off to keep them from whistleblowing. C. It actually does prevent this behavior in the real world. D. People are generally disinterested in preventing both of these in government.
The statement that "there is no such thing as a free lunch" means:
A) there are no tradeoffs between economic goals. B) any production requires the use of scarce resources, and thus the sacrifice of another alternative. C) choices need not be made in rational behavior. D) scarcity only exists in poor societies.
If a single bank faces a required reserve ratio of 20 percent, has total reserves of $500,000, and checkable deposits of $400,000, the maximum amount of money this bankcould increase the money supply is
A. $420,000. B. $100,000. C. $80,000. D. $2,100,000.