An example of moral hazard is
a. A taxi driver paid per mile taking the shortest route
b. a piece-rate garment worker shirking more than a per hour worker
c. an hourly salesman working harder than a commission salesman
d. an author on contract going to fewer book signings as one with a percentage royalty rate
d
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"If the United States enters a war in the Middle East, gasoline prices will go up." This statement is an example of
A) a positive statement. B) an argument. C) a normative statement. D) a factual statement.
During the second half of the nineteenth century and first half of the twentieth century, per capita incomes on the West Coast of the US were ___ than the national average, and per capita incomes in the South were ___ than the national average
a. lower, higher. b. higher, lower. c. lower, lower. d. higher, higher.
How does this graph indicate inelastic demand?
a. The distance between Q1 and Q2 is the same as the distance between P1 and P2.
b. The distance between Q1 and Q2 is less than the distance between P1 and P2.
c. The distance between Q1 and Q2 is slightly more than the distance between P1 and P2.
d. The distance between Q1 and Q2 is much more than the distance between P1 and P2.
Suppose option A has a higher standard deviation than option B. Which of the following statements is, in general, true?
A. A risk-averse person prefers option A to option B. B. A risk-neutral person is indifferent between options A and B. C. A risk-averse person prefers option B to option A. D. Insufficient information to determine.