Suppose that you decide to purchase either stocks or bonds of a particular corporation and you also prefer to receive some returns from the securities every year. Which should you buy - stocks or bonds? Why?
What will be an ideal response?
You should buy bonds because you would receive coupons payments each year from holding the bonds whether the corporation makes profits or not while there is no guarantee for any payment for holding stocks.
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Which of the following is a characteristic of command economies?
A) Rewards to economic agents are based on market prices. B) Coordination of economic agents is automatic. C) It is difficult to incentivize economic agents. D) The invisible hand functions without any restraint.
Suppose that for each firm in the competitive market for potatoes, long-run average cost is minimized at $0.20 per pound when 500 pounds are grown. The demand for potatoes is Q = 10,000/p
If the long-run supply curve is horizontal, then how much will consumers spend, in total, on potatoes? A) $0 B) $500 C) $10,000 D) $50,000
Which of the following is true?
A) Most entrepreneurs work very few hours. B) Entrepreneurs generally save less of their income than other Americans. C) If you want to make a lot of money, you had better figure out how to provide others with substantial value and find ways to discover and act on strategic opportunities. D) Additional years of schooling will substantially increase your earnings even if they fail to increase your productivity and ability to provide others with things that they value.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4Refer to Figure 2.4. The economy moves from Point A to Point D. This could be explained by
A. an increase in economic growth. B. a change in society's preferences for motorcycles versus hybrid cars. C. a reduction in unemployment. D. an improvement in technology.