The quality of a product
A) is usually unknown to the seller and the buyer.
B) leads to adverse selection.
C) creates noise in a market.
D) is a hidden characteristic.
D
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Refer to the scenario above. Suppose you decide to buy a Toyota Corolla. You value the car for $10,000. You don't know it, but the car dealer values it for $8,500
If you have a zero value for poor-quality cars, what is the most that would you be willing to pay for the car? A) $3,000.50 B) $6,666.67 C) $10,000 D) $5,000
The demand for Exxon gasoline is ____ the demand for all gasoline.
A. exactly as elastic as and has a different slope than B. more elastic than C. less elastic than D. exactly as elastic and has the same slope as
Arbitrage works to create a general equilibrium of exchange rates in the foreign exchange market
Indicate whether the statement is true or false
For a market to be characterized by perfect competition, there must be
A. indistinguishable products being sold. B. freedom of entry and exit. C. a large number of firms with no one able to influence price. D. all of the options are correct.