Asymmetric information before a transaction takes place generates the problem of
A) moral hazard. B) adverse selection.
C) bank runs. D) irrational behavior.
B
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One result of a tax, regardless of whether the tax is placed on the buyers or the sellers, is that the
a. equilibrium quantity of the good is unchanged. b. price the buyer effectively pays is lower. c. supply curve for the good shifts upward by the amount of the tax. d. tax reduces the welfare of both buyers and sellers.
In general, the yield curve is:
A. shaped like a mountain. B. upward sloping. C. flat. D. downward sloping.
The Cournot model is based on two firms that produce identical products and collude to set prices.
Answer the following statement true (T) or false (F)
Cindy's Sweaters' production function is shown in the above table. What is the marginal product of labor when the 4th worker is hired?
A) 4 sweaters per day B) 2 sweaters per day C) 20 sweaters per day D) 5 sweaters per day