Which of the following would be considered an example of adverse selection?
A. Malpractice insurance may increase the amount of malpractice
B. Drivers may be less cautious because they have airbags installed in a car
C. Those individuals who most need insurance are the ones most likely to buy it
D. Work contracts that give a set number of sick-days may encourage more workers to call in sick
C. Those individuals who most need insurance are the ones most likely to buy it
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
An increase in price causes exit from a constant-cost industry.
Answer the following statement true (T) or false (F)
Figure 6-3
In Figure 6-3(a), at any price above $6, quantity demanded
A. falls to zero. B. becomes infinitely large. C. equals price. D. equals the elasticity of demand.
Refer to Table 5.3. Rank the doctor's job options in expected income order, highest first
A) Work for HMO, open own practice, do research. B) Work for HMO, do research, open own practice. C) Do research, open own practice, work for HMO. D) Do research, work for HMO, open own practice. E) Open own practice, work for HMO, do research.