Moral hazard is best described as
A. an action by an individual that endangers others.
B. an action that puts one’s salvation at risk.
C. the presence of insurance increasing risk-taking behavior.
D. vigilance by individuals to keep total insurance claims at a minimum to keep rates low.
Answer: C
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If the government increases unemployment benefits, then the labor
A) demand curve shifts rightward. B) demand curve shifts leftward. C) supply curve shifts rightward. D) supply curve shifts leftward. E) Both answers B and D are correct.
A country that has a comparative advantage in producing capital goods will ________ a country that has a comparative advantage in consumption goods
A) reap all of the gains from trade when it trades with B) grow slower than C) reap fewer of the gains from trade when it trades with D) specialize in producing capital goods and trade with
Even if there are significant barriers to entry, firms may not be highly profitable
a. Substitute product offerings among rivals b. The ability of consumers to switch to substitute products easily c. All of the above d. None of the above
Based on the table below and the principle of diminishing returns to capital, then total packages wrapped when a fourth machine is installed must be less than ________ packages. Number of (Identical) MachinesTotal Packages Wrapped110,000213,000315,000
A. 2,000 B. 16,000 C. 15,000 D. 17,000