The used car market is:
A. subject to the problem of adverse selection.
B. an example of what happens when there is an imbalance of information present in a market.
C. used to describe the "lemons" problem.
D. All of these statements are true.
Answer: D
You might also like to view...
Entry of new firms will occur in a monopolistic competitive industry until:
a. marginal cost equals zero. b. marginal revenue equals zero. c. marginal revenue equals marginal cost. d. economic profit equals zero. e. economic profit is negative.
Suppose you start your own company making T-shirts that commemorate campus sporting events. An example of the resource capital would be
a. the factory you created in a building you are leasing b. your time and effort used to produce T-shirts c. the entire campus, since the demand for T-shirts is obtained from campus students d. the athletic facilities, since the athletic teams generate sporting events advertised on the T-shirts e. your creative designs used to commemorate different sporting events
How did the information revolution that kicked in during the late 1990s increase productivity?
A. Businesses learned how to use foreign suppliers to cut costs. B. Businesses were able to sell in larger markets through their websites. C. Businesses learned how to use computers to produce more output with fewer workers. D. Businesses began using the Internet to provide online training for workers.
If marginal revenue is less than marginal cost, the firm should
A. raise marginal revenue. B. decrease its rate of output. C. increase its rate of output. D. raise price.