A firm that has a well-earned reputation for providing high quality:
A. will not survive in a market if low quality is provided at a lower price.
B. has found a way to address the problem of adverse selection.
C. has found a way to address the moral hazard problem.
D. has found a way to address the free-rider problem.
Answer: B
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According to Okun's Law, if real GDP grows by 4% over a year, unemployment is likely to ________
A) increase by 0.5% B) decrease by 0.5% C) decrease by 1% D) increase by 1%
What is the average cost of producing three units?
a. $200 b. $100 c. $50 d. $70
During or just after economic booms inflationary periods have typically occurred.
Select whether the statement is true or false. A. True B. False
Bank failures tend to occur most often during periods of:
A. recessions when many borrowers have a difficult time repaying loans and lending activity slows. B. stock market run ups when, like many companies, banks tend to be overvalued. C. wars and other civil unrest. D. high inflation when the fixed rate loans of many banks cause their real returns to decrease.