Asymmetric information will lead to
a. higher prices for some used cars, lower prices for others.
b. "lemon" prices for good used cars.
c. new cars selling for prices lower than good used cars.
d. old cars selling for more than new cars.
b
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MacDougall showed in his tests that
A) relatively higher U.S. labor productivity was associated with relatively higher U.K. export ratios. B) relatively higher U.K. labor productivity was associated with relatively higher U.K. export ratios. C) labor productivity ratios and export ratios were not associated with each other. D) None of the above.
Under a perfectly competitive price system
a. an equitable allocation of the available resources will always result. b. there is no opportunity for individuals to trade amongst themselves. c. there is no reason to expect that voluntary trading will result in an equitable allocation of the available resources. d. None of the above will result.
Many rural bank failures in the 1980s can be attributed to
a. the high farm prices of the 1970s that continued to rise in the 1980s and 1990s b. farmers' reluctance to buy more machinery and expand production due to the high farm prices of the 1970s c. the collapse of farm prices and land values in the early 1980s d. numerous loans made to oil-export economies such as Mexico and Venezuela e. the lack of rural loan portfolios being involved in farm ventures
It has been argued that in the long run monopolistic competition is inefficient because
A) there are too many firms, each with excess capacity, producing too little output. B) there are few many firms, each with excess capacity, producing too much output. C) minimum average total costs are achieved but price exceeds marginal cost. D) minimum average total costs are not achieved and marginal cost exceeds price.