In the TruLite boxing department, management finds that the production team maintains several boxes of lights in a nearby storage closet. On days when the assembly line breaks down, the boxes are added back at the end of day to meet production goals. This is an example of:
A. risk premium adjustment factors.
B. beating the benchmark.
C. gaming the production system.
D. random elements in production.
Answer: C
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Which of the following is characteristic of a perfectly competitive firm's demand curve?
A. Its elasticity coefficient is 1 at all levels of output. B. Average revenue is less than price. C. It's the same as the market demand curve. D. Price and marginal revenue are equal at all levels of output.
If the Federal Reserve purchases newly issued government debt
A) the effect is as if the Treasury had printed money to cover the deficit. B) the effect is the same as borrowing from the public. C) the money supply decreases. D) existing money is destroyed.
Automobile insurance companies have a problem with people who buy insurance and then drive recklessly or take less care to avoid losses after being insured. In other words, the automobile insurance market is subject to
A) moral hazard. B) adverse selection. C) asymmetric information. D) market signaling.
In Figure 32.1, at the supported price-quantity combination where production is unlimited, and government buys the excess, the value to consumers is 
A. 0P*CQ*. B. 0HCQ*. C. 0ABQD. D. 0PfloorBQD.