A demand curve that has constant price elasticity of demand coefficient equals to one at all points is a(n):
a. rectangular hyperbola.
b. downward-sloping straight line.
c. upward-sloping straight line.
d. none of these.
a
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An increase in disposable income ________
A) has no effect on the supply of loanable funds curve B) shifts the supply of loanable funds curve rightward C) shifts the supply of loanable funds curve leftward D) results in movement up the supply of loanable funds curve
Which of the following statements best defines the economics of the so-called superstar effect in the labor market?
a. This effect will result in cases in which individuals with large productivity differences receive vastly different compensation. b. This effect occurs in cases in which individuals with small productivity differences receive very small differences in compensation. c. This effect occurs when the firm hiring the superstar simply does not understand the term marginal-revenue product. d. This effect occurs in cases in which individuals with small productivity differences receive vastly different compensation. e. This effect usually occurs in industries in which a labor union has far-reaching powers.
When a physician knows more about alternative treatments than her patients do, we say that _______ exists.
a. adverse selection b. asymmetric information c. rational ignorance d. moral hazard e. perfect information
You are a hotel manager considering four projects that yield different payoffs, depending upon whether there is an economic boom or a recession. The potential payoffs and corresponding payoffs are summarized in the following table. ProjectBoom (50%)Recession (50%)A$40-$20B-$10$30C$50-$50D$60$60The expected value of project A is:
A. $20. B. $10. C. $5. D. None of the answers are correct.