The non-democratic character of the Board of Governors of the Federal Reserve System helps support ________
A) the political business cycle
B) the time-inconsistency problem
C) its independence
D) rational expectations of Federal Reserve behavior
C
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Assume that a house is rented by four students. When it comes to keeping the house clean, each of the four roommates has an incentive to leave cleaning to the others. As a result, the house is never clean
Which of the following is the best solution to this problem of free riding? A) Assign one roommate the responsibility to keep a watch over the other students B) Require every roommate to contribute to a cleaning service C) Ask every roommate to clean the house if they dirty it D) Require each roommate to pay more toward the house rent and groceries
A government subsidy
A) is a policy that can be used to help eliminate the deadweight loss from an external cost. B) can help achieve an efficient amount of output when the good has an external benefit. C) increases consumers' marginal benefit from the good. D) Both answers A and C are correct. E) Both answers B and C are correct.