US law was recently changed so that some airplane manufacturers are immune from liability from accidents involving their decades old aircraft. As a result
a. accident rates fell due to less adverse selection
b. accident rates fell due to less moral hazard
c. accident rates rose due to less adverse selection
d. accident rates rose due to less moral hazard
b
You might also like to view...
What is the drawback for a country that chooses to fix its exchange rate?
a. Fixing the exchange rate can deteriorate the international competitiveness because the real exchange rate can't fluctuate anymore. b. Businesses in the country are more exposed to business risks associated with exchange rate changes. c. The central bank loses its ability to influence the money supply, unless severe capital controls are imposed. d. Fixing the exchange rate has no disadvantages and should be adopted by all countries.
According to the negative income tax, the breakeven income level for a program whose tax credit is $3,000 and whose tax rate is 30 percent would be
A. $4,500. B. $9,000. C. $10,000. D. $6,000.
The method of payment that a principal can use to elicit effort from an agent is called:
a. a contract. b. an order. c. an incentive. d. garbling.
Economic Profit equals accounting profit plus the cost of capital
Indicate whether the statement is true or false