With moral hazard, fair insurance contracts are not viable because
a. individuals' aversion to risk is reduced.
b. insurance company's administrative costs are increased.
c. individuals fear unscrupulous agents.
d. probabilities of loss are increased over what is expected.
d
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In order for barter trades to occur, there must be a
A. singularity of interests. B. bargaining intermediary. C. double coincidence of wants. D. sufficient supply of cash.
Jon's income-consumption curve is a straight line from the origin with a positive slope. Now suppose that Jon's preferences change such that his income-consumption curve remains a straight line but rotates 15 degrees clockwise
Jon's demand curve for the good on the horizontal axis A) will shift left. B) will shift right. C) will not change. D) might do any of the above.
The horizontal and vertical axes of the Lorenz curve respectively measure:
a. total income and total expenditure as cumulative percentages. b. total income and total population as cumulative percentages. c. total population and total expenditure as cumulative percentages. d. total expenditure and total income as cumulative percentages. e. total population and total income as cumulative percentages.
Based on the table showing a summary of fiscal tools, if the government increases taxes, it is most likely trying to ______.
a. fight inflation
b. utilize expansionary policy
c. boost aggregate demand
d. fight unemployment