If you sell your DVD player on eBay, you will be better informed about the quality of the product than any potential buyer. This is called
A) adverse selection.
B) asymmetric information.
C) moral hazard.
D) opportunistic behavior.
B
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If the demand increases in a perfectly competitive market, what will likely occur?
A. Firms will temporarily make a profit due to a higher price. B. Firms will enter the market in hopes of capturing some profits. C. The short-run supply curve will shift to the right, causing price to eventually fall. D. All of these are true.
The government of Economica announces that it will purchase its farmers' surplus of milk. From this announcement, you can infer that Economica has a
a. free market for milk. b. price ceiling above the equilibrium price for milk. c. price floor above the equilibrium price for milk. d. price floor below the equilibrium price for milk.
The annual interest payment divided by the bond's price is the
A. Current yield. B. Default value. C. Market price. D. Risk yield.
Refer to the above figure. If the government imposes a price floor of $60
A. the quantity of goods that will be traded is 200. B. the quantity of goods that will be traded is 0. C. the quantity of goods that will be traded is 100. D. the quantity of goods that will be traded is 150.