Which of the following is a "guns or butter" decision?
(A) A school has to decide whether to build a new gym or renovate the auditorium.
(B) A man must decide whether to install an alarm system in his house or buy new furniture for the living room.
(C) A woman has to decide whether to replace her old car with a new sports car or a family sedan.
(D) A country must decide whether to use its steel to build new fighter jets or new sports cars.
Ans: (D) A country must decide whether to use its steel to build new fighter jets or new sports cars.
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Refer to Scenario 12.2. In this game, Jerome's tough strategy would lead to his preferred equilibrium of
A) Eliza donates a kidney and Jerome does not. B) both Eliza and Jerome donate a kidney. C) Jerome donates a kidney and Eliza does not. D) neither Eliza nor Jerome donates a kidney.
The market in which banks borrow from other banks for short periods of time is the
a. discount market b. federal funds market c. interbank loan market d. national bank market e. liquidity market