Suppose that a borrower has a near-perfect credit history before the bank loans him some money. Shortly after the loan has been made, he loses his job and spends money recklessly. This describes the problem known as
A) moral hazard.
B) adverse selection.
C) risk aversion.
D) asymmetric information.
A
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Suppose a person's utility for leisure (L) and consumption (Y) can be expressed as U = Y + L0.5. Assuming a wage rate of $10 per hour, show what happens to the person's labor supply curve when the person wins a lottery prize of $100 per day
What will be an ideal response?
Empirical studies indicate that the maximum amount of air pollution occurs ________ levels of real GDP per person.
A. at "middle-income" B. at the lowest C. equally at all D. at the highest
In the _________, if profits are not possible, the perfectly competitive firm will seek out the quantity of output where _____________________.
a. long run; production increases b. short run; fixed costs can be reduced c. short run; losses are smallest d. long run; fixed costs can be eliminated
Refer to Table 21.3 below:Table 21.3Units of LaborUnits of OutputMPP00 1 30266 3 304116 What is the marginal physical product of the fourth unit of labor in Table 21.3?
A. 5. B. 116. C. 29. D. 20.