If You Were Asked to Recommend Whether a Rich Country

question 1

Multiple Choice

If you were asked to recommend whether a rich country with a two-party system should adopt presidentialism or parliamentarism, which would you choose? Assume that your goal is to allow them to avoid democratic collapse. Assume also that the country is unlikely to change either its level of income or its electoral rules in the near future.

• A) presidentialism
• B) parliamentarism
• C) It wouldn't make a much of difference for democratic survival in this case, so they should use some other criteria on which to base their decision.

---

Definitions:

Cost of Equity

The cost of equity refers to the return a company must offer investors to compensate for the risk they undertake by investing in the company's equity.

Dividend Yield

A finance ratio illustrating the yearly dividends paid by a company in comparison to its stock price.