The two types of asymmetric information situations are those with
a. hidden costs and hidden actions
b. hidden characteristics and hidden costs
c. hidden actions and hidden selection
d. hidden characteristics and hidden actions
e. moral hazard and natural selection
D
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Refer to Figure 16-5. Suppose the firm represented in the diagram decides to use a two-part pricing strategy such that it charges a fixed fee and a per-unit price equal to the monopoly price
What is the revenue collected from the fixed fee portion of the price? A) $10,240 B) $7,870 C) $2,560 D) $1,440
The flaw of the Classical model of the business cycle is that it
A) assumes away output fluctuations. B) assumes complete wage rigidity. C) assumes unrealistic fooling of workers. D) requires procyclical wage movements and continuous labor market equilibrium.
The incidence of a tax refers to
a. who receives the benefits from the revenue generated by the tax b. the changes in the marginal tax rate as income increases c. whether the tax is regressive, proportional, or progressive d. who bears the burden of the tax e. whether the tax is based on the ability-to-pay principle
Total output includes all of the following except:
A. Household consumption. B. Business investment. C. Imports. D. Government services.