Which of the following is a probable consequence of the presence of accounting rules that allow firms to hide the financial impact of actions that would harm investors?
a. Investors may be able to enforce market efficiency.
b. The WTO will disenfranchise the country that allows this to happen.
c. Investors will immediately organize a speculative attack and the price of stocks will inflate.
d. The balance-of-payments deficit will increase, leading the economy into a debt trap.
e. Investors may not be able to adequately judge when the risk of investing in a firm rises.
e
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The capture theory of regulation implies that
A) regulations promote the attainment of efficiency. B) regulations promote the attainment of economic profit. C) public officials favor voters over producers. D) the demand for regulation is less elastic than the supply.
Suppose new electronic devices make it easier to monitor the effort levels of workers. What happens to the NSC curve in the efficiency wage model?
A) Shifts upward B) Shifts downward C) Remains the same D) The NSC curve remains the same, and the labor supply curve shifts leftward because shirking workers will leave the labor force.