Suppose the government is auctioning the right for a company to mine for gold in a government-owned region of the country. Further suppose that the government has information regarding the amount of gold that is likely to be found in the region, but the companies bidding for the rights do not have this information. This is an example of ________.

A) screening
B) the principal-agent problem
C) the lemons problem
D) asymmetric information


D) asymmetric information

Economics

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Define "stagflation" and explain how it can be created

What will be an ideal response?

Economics

An increase in foreign output would cause the domestic country's net exports to ________ and cause the domestic country's IS curve to ________

A) rise; shift up B) rise; shift down C) fall; shift up D) fall; shift down

Economics

Bond prices and interest rates:

a. are interrelated b. have no relationship to one another c. rise or fall in tandem d. none of these choices

Economics

What would be the price of a perpetuity bond that has a $100 interest payment and a 4% yield?

a) $1,000 b) $2,000 c) $2,500 d) $4,000

Economics