A street vendor sells a replica of a pair of designer shoes to a young woman who believes the shoes are authentic. The street vendor is engaging in
a. both moral hazard and adverse selection.
b. neither moral hazard nor adverse selection.
c. moral hazard, but not adverse selection.
d. adverse selection, but not moral hazard.
d
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The two main responsibilities of the Federal Reserve System are to ________ and to ________.
A. insure bank deposits; print currency B. enable banks to make affordable mortgages; control the exchange rate of the U.S. dollar C. apprehend counterfeiters; regulate the stock market D. conduct monetary policy; oversee financial markets
Which of the following statements is true of marginal analysis?
A) Marginal analysis is a tool used in optimization in levels. B) Marginal analysis compares the consequences of doing one more step of something. C) Marginal analysis of alternatives will mostly give an outcome different from optimization in levels. D) Marginal analysis involves the calculation of total net benefits of all the available alternatives.
________ of unemployment during ________ make it easier for workers to ________ wages
A) Low levels; an expansion; negotiate higher B) High levels; an expansion; accept lower C) High levels; a recession; negotiate higher D) Low levels; a recession; accept lower
Alex must prepare for exams in both biology and economics this week. Assume that the production possibilities curve showing the tradeoff between exam scores in biology and economics is concave toward the origin. As Alex moves along the curve spending more of his time studying for economics, the opportunity cost of an hour of preparation for economics: a. increases
b. remains constant. c. decreases. d. first increases then decreases.