An insured person's incentive to behave in ways that raise the probability of a claim is known as:
a. a moral hazard.
b. the lemons problem.
c. the problem of adverse selection.
d. the problem of advantageous selection.
A
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In the long-run equilibrium, perfectly competitive firms produce where
A) marginal cost is minimized. B) average total cost is minimized. C) average revenue is zero. D) All of the above are correct.
Which of the following best describes the impact of the Emissions Trading Scheme in the European Union between 2005 and the late 2000s?
A) Overall greenhouse gas emissions increased. B) Overall greenhouse gas emissions decreased. C) Overall greenhouse gas emissions were totally eliminated. D) Overall greenhouse gas emissions were constant.
What is the largest possible loss that is consistent with a firm producing in a perfectly competitive market in long-run competitive equilibrium?
a. An amount equal to (price less average variable cost). b. An amount equal to total variable. c. Zero. d. An amount equal to total fixed cost.
As inflation increases, households become ________ uncertain leading to ________ spending.
A. less; less B. more; more C. less; more D. more; less