Economists disagree on most economic issues facing an economy
a. True
b. False
Indicate whether the statement is true or false
False
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The natural rate of unemployment is defined as the rate of unemployment that
A) exists only during periods of recession or depression in the economy. B) exists due to welfare and unemployment benefits that reduce potential workers' incentives to find work. C) prevails in long-run macroeconomic equilibrium, when all workers and employers have fully adjusted to any changes in the economy. D) prevails in the short-run macroeconomic equilibrium, before workers and employers have had a chance to adjust to an economic shock.
Health insurance markets are likely to attract a disproportionate number of ________ individuals
A) high-risk B) risk-seeking C) low-risk D) risk-averse
Briefly explain the similarities and differences of decision making by the market sector and the public sector
What will be an ideal response?
Suppose a risk-neutral power plant needs 10,000 tons of coal for its operations next month. It is uncertain about the future price of coal. Today it sells for $60 a ton but next month it could be $50 or $70 (with equal probability). How much would the power plant be willing to pay today for an option to buy a ton of coal next month at today's price? (Ignore discounting over the short period of a
month.) a. 5 b. 4 c. 3 d. 0