Adverse selection and moral hazard problems arise when there is
A) complete information
B) asymmetric information.
C) too much information.
D) symmetric information.
B
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In 2008 the fall in the value of the stock market decreased people's wealth. As a result of this change alone, the supply of loanable funds
A) did not change, and there was a downward movement along the supply of loanable funds curve. B) did not change, and there was an upward movement along the supply of loanable funds curve. C) decreased. D) did not change, and there was no movement along the supply of loanable funds curve. E) increased.
The main reason that many businesses fail when the price level is falling is that ________
A) deflation causes a decline in short-run aggregate supply B) as prices fall, businesses are unable to predict the quantity of output they will be able to sell C) the real value of the firms assets declines in proportion to the decrease in the price level D) falling prices mean that regular loan payments become increasingly difficult
In the above figure, what is the profit-maximizing output and price?
A) 8, $7 B) 10, $8 C) 12, $10 D) 10, $10
In the long run when monopolistically competitive firms advertise,
a. they will still earn zero economic profit b. they can earn positive economic profit by increasing market share c. the market price must fall d. the market price must rise e. there will be fewer units sold than in the short run