The Department of Education noticed that for loans granted to students without any strings, the average grade point average of the students decreases dramatically over time, while the students whose loans renew only if they pass their courses tends to stay stable. This could be due to a
a. Adverse selection problem
b. Moral hazard problem
c. Typical college life phenomenon
d. None of the above
b
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A market in which firms can enter and leave so easily that firms in the market face competition from potential entrants is called a
A) contestable market. B) cartel. C) limit pricing market. D) monopolistic competition market.
When the domestic money prices of goods are held constant
A) a nominal dollar appreciation makes U.S. goods cheaper compared with foreign goods. B) a nominal dollar depreciation makes U.S. goods less appealing in foreign markets. C) a nominal dollar appreciation does not affect the prices of U.S. goods. D) a nominal dollar depreciation makes U.S. goods more expensive compared with foreign goods. E) a nominal dollar depreciation makes U.S. goods cheaper compared with foreign goods and a nominal dollar appreciation makes U.S. goods more expensive compared with foreign goods.
Which of the following provide the best evidence of specialization?
a. a firm that produces a line of related products, such as eight kinds of breakfast cereal b. an architect who is willing to practice in only one geographic area c. a physician that practices in a specialty area such as cardiology or orthopedic surgery d. a family that eats at Wendy's every Thursday night e. a retailer that sells goods but provides no services
Many people consider lump-sum taxes to be unfair to low-income taxpayers
a. True b. False Indicate whether the statement is true or false