The "lemons" problem is that
a. cars of verifiable high quality are withheld from the used car market
b. cars of verifiable low quality are withheld from the used car market
c. cars of unverifiable high quality are withheld from the used car market
d. cars of unverifiable low quality are withheld from the used car market
c
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As disposable income decreases, consumption:
A. decreases. B. may either increase or decrease depending on the wealth effect. C. may either increase or decrease depending on the mpc. D. increases.
A firm can stay in business while taking a loss in the short run as long as it covers its
A. fixed costs. B. variable costs. C. fixed and variable costs. D. A firm can never stay in business when it experiences losses.
There is greater support for active policymaking when
A. price flexibility is common. B. pure competition is common. C. wage flexibility is common. D. none of these.
Gertrude Stork's Chocolate Shoppe normally employs 4 workers. When the Chocolate Shoppe hired a 5th worker, the Shoppe's total output decreased. Therefore
A) the marginal product of the 5th worker is negative. B) the total output of Gertrude Stork's Chocolate Shoppe is negative. C) the average product of the 5th worker is negative. D) the 5th worker should be hired only if he is willing to accept a wage lower than the wage paid to the other 4 workers.