Explain the capture hypothesis
What will be an ideal response?
The capture hypothesis is a theory of regulatory behavior that predicts that the regulators eventually will be captured by the special interests of the industry being regulated. It is observed that many times regulators come from the regulated industry. Further, the firms have more at stake than consumers and are more likely to organize and lobby for favors than are the consumers. Hence, over time, the regulators will tend to do what the regulated firms want rather than what the consumers want.
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In practice, under the EMS, a member country
A) could never change its interest rate. B) could change its interest rate only if other countries changed theirs as well. C) must apply to a special European Commission in order to change its interest rate. D) had complete freedom in choosing the interest rate it wanted. E) had complete freedom in choosing its interest rate only if it is a very small country.
A supply schedule shows: a. projected sales as ad spending varies
b. how many units producers are willing and able to sell at various prices. c. possible combinations of output as input prices vary. d. how many units consumers would like to buy at various prices.