The government regulates financial markets for two main reasons: A. to ensure that financial intermediaries do not earn more than the normal rate of return and to improve control of monetary policy. B. to ensure soundness of the financial system and to increase the information available to investors. C. to improve control of monetary policy and to increase the information available to investors. D. to ensure soundness of financial intermediaries and to prevent financial intermediaries from earning less than the normal rate of return.

In which of the following games is it clearly the case that the cooperative outcome of the game is good for the two players and bad for society? a. two oil companies own adjacent oil fields over a common pool of oil, and each company decides whether to drill one well or two wells.b. two airlines dominate air travel between city a and city b, and each airline decides whether to charge a "high" airfare or a "low" airfare on flights between those two cities.c. two superpowers decide whether to build new weapons or to disarm.d. in all of the above cases, the cooperative outcome of the game is good for the two players and bad for society