When sellers have more information about hidden characteristics of a good than buyers have, more low-quality units are likely to be sold than high-quality units. This is
a. the law of diminishing marginal returns
b. the law of natural selection
c. the winner's curse
d. the lemons problem
e. the problem of common pools
D
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An insight into business cycles is gained by the fact that
A) changes in real GDP result in changes in autonomous expenditures. B) at a peak, a decrease in autonomous expenditure leads to a decrease in induced expenditure. C) autonomous expenditure does not change at either a peak or a trough. D) at a peak, autonomous expenditure increases, thereby leading to a recession. E) at a trough, induced expenditure decreases, thereby leading to an expansion.
Household production is more likely to occur when
a. it requires many specialized resources b. technology makes it more costly than market production c. tax avoidance is undesirable d. more control over the final product is desirable e. all of the above
If marginal cost is increasing, average total cost must be increasing
Indicate whether the statement is true or false
It is increasingly clear that technological change is the only explanation for an expanding wage gap between high-skill and low-skill workers
a. True b. False Indicate whether the statement is true or false