In the short run, the fixed costs of a firm:
A. are irrelevant in deciding whether to shut down production.
B. are equal to zero when quantity produced is zero.
C. are all the costs it incurs when it produces some positive quantity.
D. can sometimes be avoided in the short run.
Answer: A
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The process by which banks screen potential applicants by eliminating bad risks and to obtain a pool of creditworthy borrowers is called:
A) gap analysis B) duration analysis C) credit-risk analysis D) liquidity analysis
Lemon laws are an attempt to reduce __________ in used car markets
a. symmetrical information b. adverse selection c. natural selection d. moral hazard e. the winner's curse
Which of the following would constitute the strongest evidence of employment discrimination against female employees?
a. The average wage of female workers is lower than the average wage of males. b. The average wage of female employees is lower than the average wage of males with similar productive characteristics. c. The mean number of years of schooling of female workers is lower than that of males. d. The average hours worked by female employees is less than the average hours worked by males.
When the government reduces my income tax by $0.30 for every $1.00 that I contribute to a charity, the government is effectively
a. alleviating the negative externalities that are associated with charitable giving. b. imposing a negative externality on those who do not pay income taxes. c. encouraging a private solution to a positive-externality problem. d. encouraging a private solution to a negative-externality problem.