-In the Figure Above, the SLF Curve Is the Supply

question 25

Multiple Choice

-In the figure above, the SLF curve is the supply of loanable funds curve and the PSLF curve is the private supply of loanable funds curve. If there is no Ricardo-Barro effect and the government now runs a balanced budget,

• A) the equilibrium interest rate is 4 per cent and investment is $1.8 trillion.
• B) the interest rate will increase from 4 per cent to 6 per cent.
• C) the equilibrium interest rate is 6 per cent and investment is $1.6 trillion.
• D) there is shortage of investment funds of $0.4 trillion.
• E) there is a surplus of investment funds and the interest rate falls to 4 per cent.

Evaluate the role of cooperation, cheating, and first-mover advantage in repeated games.

Distinguish between extensive form and strategic form representations of games.

Understand the application and limitations of backward induction and subgame perfection.

Assess the effects of potential entry and exit strategies in competitive markets.

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Definitions:

D-Gulose

An aldohexose sugar in the D-configuration, a stereoisomer of glucose with a specific arrangement of hydroxyl groups.

L-Gulose

A rare sugar, an isomer of glucose, not commonly found in nature.

Fischer Projection

A two-dimensional representation of a three-dimensional organic molecule by projection, used to depict stereoisomers.

Fischer Projection

A two-dimensional representation of a molecule's structure to display chirality by projecting asymmetric carbon atoms.