This topic contains a solution. Click here to go to the answer

Author Question: In what way can liability rules lead to a more efficient outcome? What will be an ideal ... (Read 64 times)

karateprodigy

  • Hero Member
  • *****
  • Posts: 550
In what way can liability rules lead to a more efficient outcome?
 
  What will be an ideal response?

Question 2

Suppose there is a bank panic. Which of the following would not be a consequence of this bank panic?
 
  A) Individual banks would have to shrink the value of loans they made.
  B) The economy would likely enter into a recession.
  C) Bank total reserves would decrease.
  D) Bank checking account balances would decrease.
  E) Required reserves would increase.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

sierramartinez

  • Sr. Member
  • ****
  • Posts: 313
Answer to Question 1

Liability rules are designed to force decision makers to internalize an externality. They provide an incentive for individuals to weigh both the actual and potential costs and benefits of their actions.

Answer to Question 2

E




karateprodigy

  • Member
  • Posts: 550
Reply 2 on: Jun 29, 2018
:D TYSM


samiel-sayed

  • Member
  • Posts: 337
Reply 3 on: Yesterday
Excellent

 

Did you know?

Coca-Cola originally used coca leaves and caffeine from the African kola nut. It was advertised as a therapeutic agent and "pickerupper." Eventually, its formulation was changed, and the coca leaves were removed because of the effects of regulation on cocaine-related products.

Did you know?

Interferon was scarce and expensive until 1980, when the interferon gene was inserted into bacteria using recombinant DNA technology, allowing for mass cultivation and purification from bacterial cultures.

Did you know?

The National Institutes of Health have supported research into acupuncture. This has shown that acupuncture significantly reduced pain associated with osteoarthritis of the knee, when used as a complement to conventional therapies.

Did you know?

Hypertension is a silent killer because it is deadly and has no significant early symptoms. The danger from hypertension is the extra load on the heart, which can lead to hypertensive heart disease and kidney damage. This occurs without any major symptoms until the high blood pressure becomes extreme. Regular blood pressure checks are an important method of catching hypertension before it can kill you.

Did you know?

Blood is approximately twice as thick as water because of the cells and other components found in it.

For a complete list of videos, visit our video library