Refer to Scenario 17.4. Moral hazard would be eliminated in this situation if
A) the insurer would always charge $5000.
B) the insurer would always charge $10,000.
C) the insurer could costlessly monitor whether a flood control system is in place, and adjust the premium upward if it is not.
D) the insurer could costlessly monitor whether a flood control system is in place, and adjust the premium downward if it is not.
E) the flood did not occur.
C
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The long-run perfectly competitive equilibrium
A. results in normal profits. B. is not economically efficient. C. will never change once it is realized. D. is realized only in constant-cost industries.
Gary, Kevin, and Joshua are three individuals who were previously employed but do not have jobs now. Gary lost his job a year ago
Although he would like to have a job, he has given up looking for one as he thinks there are no suitable jobs available for him. Kevin was working as a finance teacher, but quit his job a few months back to become a stock broker. Ever since he quit his job, he is unable to get a new one, although he is actively seeking. Joshua was employed in a steel mill. He lost his job when the labor union in his mill demanded a hike in wages. Classify the three individuals according to their type of unemployment.
If people expect the price of automobiles to increase drastically next year, it is likely that the demand curve for this year's automobiles will shift to the right
Indicate whether the statement is true or false
Define the following terms and explain their importance to the study of economics:
a. antitrust policy b. economies of scale c. economies of scope