Answer the following statement true (T) or false (F)
1) The Securities and Exchange Commission's supervision of Wall Street financial firms is a
possible example of regulatory capture.
2) Economists widely support deregulation of industries that tend toward monopoly or generate
substantial negative externalities.
3) Deregulation is seen as a solution to regulatory capture because it eliminates the regulatory
agency that can or has been captured.
4) Government loan guarantees tend to socialize gains and privatize losses.
5) Government guarantees that socialize losses and privatize gains tend to encourage risky and imprudent investment.
1) T
2) F
3) T
4) F
5) T
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The types of goods Japan exports and imports appear to be well explained by
A) Japanese endowments of factors of production (e.g. land, labor, capital, natural resources). B) high and rising Japanese tariffs. C) advertising and other sales promotion efforts. D) All of the above.
Fed policy since the early 1990s indicates that it is pursuing a policy of targeting the
A) monetary base. B) money supply. C) federal funds interest rate. D) exchange rate.