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A colleague tells you that he can get a business loan from the bank, but the rates seem very high for what your colleague considers a low risk loan.
a. Give an adverse selection explanation for this, and offer advice to your friend on how to solve the problem.
b. Give a moral hazard explanation for this, and offer advice to your friend on how to solve the problem.
In national income accounting, grain fed to a hog at a commercial hog farm is considered a(n) a. final good b. intermediate good c. consumer good d. capital consumption allowance
You are a member of the City Council of Mid ville , California, a town of 10,000 residents, comprised primarily of 'middle-class' blue-collar laborers.
Suppose that the average prices of refrigerators have fallen over the past few years, yet the refrigerator companies have offered more and more of them for sale. Does this mean that the supply curve for refrigerators is downward sloping?
The supply of loanable funds will shift to the right if either: A) Tax reforms encourage greater saving or investment tax credits were increased B) The budget deficit became larger or tax reforms discouraged savings C) The budget deficit became large..
The question asked was assume that the government imposes a price ceiling on toasters. In particular, suppose that it decrees that a toaster cannot sell for more than $14.
To what extent do you think that immigrant families should give up their customs to become part of their host Nation.
A open economy has a marginal propensity to import equal to .2 and a marginal propensity to consume equal to .7. Determine propensity to save of this economy?
Calculate the appreciation or depreciation of the US dollar relative to the Japanese yen.
Market Value of the final goods and services produced in the domestic economy= $1,15,000 of which goods worth $10,000 are distributed among the Tsunami Victims. Net factor income to abroad= 4000 and the govt. is offering subsidies to the producers..
Early in 2007, a survey of greenhouses indicated that the demand for houseplants was rising sharply. AT the same time, large numbers of low price producers started growing plants for sale. The overall result was a drop in the average price of hou..
Carrie needs to accumulate $40,000 to make a down payment on a house at the end of four years.
Bertand: If the firms compete on the basis of (continuous) price, what is the Nash equilibrium if the game is played once? A finite number of times? Explain clearly.
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