When housing prices ________ as they did beginning in 2006 following the housing market bubble, most banks and other lenders tightened the requirement for borrowers, making it ________ for potential home buyers to obtain mortgages
A) fell; easier B) rose; easier C) rose; harder D) fell; harder
D
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Elasticity is:
A) the sum of the percentage change in two variables. B) the difference of the percentage change in two variables. C) the product of the percentage change in two variables. D) the ratio of the percentage change in two variables.
You offer an extended warranty for your product that is purchased by a few customers. If the product typically fails 2% of the time, the claim rate will exceed 2% of warranty purchasers because
a. adverse selection will lead those who are more reckless to purchase the warranty b. moral hazard will lead those who purchase to be more reckless c. you systematically underestimate product failure rates d. Both A&B
In a communist economy,
A. the state controls the means of production. B. individuals decide what to produce, how to produce it and who gets it. C. economic decisions are decentralized. D. the market system is used to allocate resources.
In economics, a public good
A. Is provided in an optimal amount by the market. B. Is any good produced by the government. C. Cannot be denied to consumers who have not paid. D. Has social costs of production lower than private costs of production.