Jim used to be very careful with his car. However, once he bought full auto insurance on it, he stopped turning on his alarm or even locking it when parking it. This is an example of adverse selection.
Answer the following statement true (T) or false (F)
False
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Any point on the production possibility frontier is
A) attainable and might be allocatively inefficient. B) attainable and must be allocatively efficient. C) less production efficient than a point in the interior of the PPF. D) always allocatively efficient but might or might not be production efficient. E) always production efficient and always allocatively efficient.
Hundreds of speculators conclude in May that the coming summer's corn crop will be much lower and that the November corn price will be consequently much higher than most people expect
When they act on their beliefs in the futures market, they would strive to ________ corn futures, which would tend to ________ the price of corn futures. A) sell; reduce B) sell; raise C) buy, reduce D) buy; raise
The time-inconsistency problem with monetary policy tells us that, if policymakers use discretionary policy, there is a higher probability that the ________ will be higher, compared to policy makers following a behavior rule
A) inflation rate B) unemployment rate C) interest rate D) foreign exchange rate
The author of the textbook defines economics as the
A) science of efficiency. B) science of scarcity. C) study of markets. D) study of human activity.