When players cannot achieve their goals because they are unable to make credible threats or promises, the situation is called a:
A. failure of dominant strategies.
B. commitment problem.
C. Nash equilibrium.
D. prisoner's dilemma.
Answer: B
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Answer the next question based on the following price and output data over a five-year period for an economy that produces only one good. Assume that year 2 is the base year. YearUnits of OutputPrice per Unit18$22103315441855206If year 2 is the base year, the Consumer Price Index for year 2 is
A. 50. B. 67. C. 150. D. 100.
When the Fed buys government securities in the open market, it ________.
A. decreases the excess reserves of the banking system, reducing excess reserves for overnight loans in the federal funds market and thus lowering the federal funds rate B. increases the excess reserves of the banking system, raising excess reserves for overnight loans in the federal funds market and thus lowering the federal funds rate C. increases the excess reserves of the banking system, reducing excess reserves for overnight loans in the federal funds market and thus lowering the federal funds rate D. decreases the excess reserves of the banking system, reducing excess reserves for overnight loans in the federal funds market and thus increasing the federal funds rate
Total variable cost is the sum of all
A) costs of the firm's fixed factors of production. B) costs associated with the production of goods. C) costs that rise as output increases. D) implicit costs.
Adverse selection in insurance requires that
a. all people face the same risk b. potential customers facing more risk are more interested in purchasing insurance c. people are not risk averse d. insurers can tell higher risk people from lower risk people