A consequence of adverse selection is:
A. buyers gain surplus they would have lost with complete information.
B. sellers gain surplus they would have lost with complete information.
C. transactions do not take place that would have been possible if the parties had the same information.
D. buyers make irrational decisions because they lack information.
C. transactions do not take place that would have been possible if the parties had the same information.
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The government can potentially improve market outcomes if market inequalities or market failure exists
a. True b. False Indicate whether the statement is true or false
Tariffs and quotas on imported goods used as inputs in production shift the
A. AS curve to the left. B. AS curve to the right. C. AD curve to the right. D. None of the choices are correct.
From Table 2.2, which column is the one for shortage? 
A. column A B. neither A nor B C. column B D. either A or B are equally likely
For a perfectly competitive firm, when P = MC = ATC, the firm should reduce its output so as to increase its profits.
Answer the following statement true (T) or false (F)