Reference no: EM131332405
Part A: Answer each of the following questions in one to three paragraphs.
1. Why is the right of private property an essential characteristic of a market system?
2. Rivalry and excludability are the two characteristics of goods that are produced through the competitive market system. Compare and contrast the difference in private and public goods based on these two characteristics Then, explain the concept of the free-rider problem with public goods.
3. How do economists distinguish between the absolute and relative sizes of the United States public debt? Why is the distinction important?
Part B: Answer each of the following questions in one to four sentences.
1. State at least one economic benefit to increased international trade.
2. Why might a corporation prefer to obtain financing through bonds instead of stocks? In contrast, why might a corporation prefer to obtain financing through stocks instead of bonds?
3. Is a credit card considered to be money? Explain.
4. Explain what is meant by a command economy.
5. What are the two main investor preferences, and how do they conflict?
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