A difference between moral hazard and adverse selection is that
a. moral hazard deals with pre-contractually determined public information
b. moral hazard deals with post-contractually determined private information
c. adverse selection deals with pre-contractually determined private information
d. adverse selection deals with post-contractually determined public information
b
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"If the price of crude oil falls, the demand for gasoline will increase, so people will by more gas and the price of gas will go u
What will be an ideal response?
Ceteris paribus, an increase in the government budget deficit increases interest rates in the United States and causes a real appreciation of the dollar
Indicate whether the statement is true or false
The market for soybeans in Canada consists solely of domestic buyers of soybeans and domestic sellers of soybeans if
a. consumer surplus equals producer surplus in the Canadian soybean market. b. total surplus exceeds consumer surplus in the Canadian soybean market. c. Canada permits international trade in soybeans. d. Canada forbids international trade in soybeans.
Which of the following is true?
A. In Cournot oligopoly markets, firms produce an identical product at a constant marginal cost and engage in price competition. B. In oligopoly markets, a change in marginal cost never has an effect on output or price. C. In Bertrand oligopoly markets, each firm believes that its rivals will hold their output constant if it changes its output. D. In Sweezy oligopoly markets, each firm believes rivals will cut their prices in response to a price reduction, but will not raise prices in response to price increases.