Refer to the scenario above. Which of the following problems is most likely to arise in this case?
A) Adverse selection
B) Moral hazard
C) The tragedy of the commons
D) The free-rider problem
B
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Economic agents have an incentive to formulate expectations rationally
A) because ignoring information is usually costly. B) to increase prices. C) to reduce wages. D) to ensure that all expectations are realized.
Central bank independence ________
A) is receding as democratic movements gain influence around the world B) is correlated with relatively high unemployment C) remains an obstacle to policy transparency D) is the norm in a growing number of countries
False advertising is least likely to be successful with ________ goods.
A) experience B) credence C) greenwashed D) inspection
Which of the following is most likely a fixed cost? a. Raw materials costs
b. Shipping charges. c. Property insurance premiums. d. Fuel costs for running the factory.