Adverse selection is a situation in which one party, as a result of a contract, has an incentive to alter their behavior in a way that harms the other party to the contract
a. True
b. False
B
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The Fed frequently uses the discount rate and the required reserve ratio as instruments of monetary policy
a. True b. False Indicate whether the statement is true or false
The aggregate-demand curve shows the
a. quantity of labor and other inputs that firms want to buy at each price level. b. quantity of labor and other inputs that firms want to buy at each inflation rate. c. quantity of domestically produced goods and services that households want to buy at each price level. d. quantity of domestically produced goods and services that households, firms, the government, and customers abroad want to buy at each price level.
In this graph for negative externalities in production, the efficient equilibrium point is at ______.
a. point A
b. point B
c. P1 and Q1
d. P2 and Q2
The demand curve for a good is horizontal when it is:
A. a unitary elastic good. B. a perfectly inelastic good. C. an inferior good. D. a perfectly elastic good.