Stockholders of ComfortAir Corporation, an air conditioner and furnace manufacturer, are concerned that the companies executives may take on greater risks than stockholders desire. This example illustrates
a. moral hazard and market risk.
b. moral hazard and firm specific risk.
c. adverse selection and market risk.
d. adverse selection and firm specific risk.
b
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An imperfectly competitive firm has the following total cost curve: C = 100 + 4Q. What is marginal cost equal to when Q = 10?
What will be an ideal response?
Real GDP is most commonly used to monitor short-run changes in
a) economic activity. b) the rate at which a person can trade the currency of one country for the currency of another. c) the income distribution over time. d) the price index from the preceding period.
?Which of the following would not appear on a firm's accounting statement?
a. ?Fixed costs b. ?Insurance costs c. ?Explicit costs d. ?Sunk costs e. ?Implicit costs
The tax that brings in the most revenue in the United States is the
A) capital gains tax. B) corporate income tax. C) Social Security tax. D) personal income tax.