Deadweight loss and market failure are created when a market produces
A) either more or less than the efficient quantity.
B) more than the efficient quantity but not when less than the efficient quantity is produced.
C) less than the efficient quantity but not when more than the efficient quantity is produced.
D) the efficient quantity.
E) None of the above answers is correct because deadweight loss has nothing to do with the efficient quantity.
A
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In which of the following cases is the slope of a line positive?
A) As x increases, y increases. B) As x increases, y decreases. C) As x increases, y remains the same. D) As x increases, y equals a positive number.
When a company whose ability to repay its obligations in full is uncertain,
A) it will have to issue debt with longer maturities than would a company with a lower probability of default. B) its bonds will sell for higher prices than would the bonds of a company with a lower probability of default. C) it must offer investors higher yields to compensate them for the risk they take in buying their bonds or making loans. D) it must do so through financial markets rather than through financial intermediaries.