If an economy is stuck in a "bad" equilibrium in the coordination failure model
A) the government should intervene by spending more.
B) the government should intervene by spending less.
C) the government should promote optimism.
D) there is nothing that can be done.
C
You might also like to view...
According to international trade theory, a country can gain
a. if it protects domestic industries from low-wage foreign producers. b. only if the trade harms its trading partners. c. by importing goods when they can be obtained more economically from foreign producers. d. if it maximizes the employment in domestic industries that face competition from foreign producers who have lower costs.
When a transaction takes place repeatedly, then one way to signal to avoid information asymmetry is:
A. building a reputation. B. screening. C. statistical discrimination. D. Any of these could be true.