An individual insured against a particular cost,
a. has reduced incentives to take precautions against those costs.
b. may take on additional risk because he/she is insured
c. faces incentives that can result in higher insurance rates.
d. All of the above are true.
d
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Which of the following is NOT a component of M1?
A) savings deposits B) currency C) demand deposits D) traveler's checks E) Both answers C and D are correct.
Assume the firms in a perfectly competitive industry are initially in long-run equilibrium and the cost of labor increases. How will the market adjust over time?
A) Firms will enter the market, causing price to rise until losses are eliminated. B) Firms will enter the market, causing price to fall until positive profits are eliminated. C) Firms will exit the market, causing price to rise until losses are eliminated. D) Firms will exit the market, causing price to fall until positive profits are eliminated.
A criticism of market-oriented schemes says that consumers may not be well informed.
A. True B. False C. Uncertain
Total satisfaction is maximized when
A) marginal utility is positive. B) marginal utility is negative. C) marginal utility is zero. D) marginal utility is equal to average utility.