The existence of adverse selection results in:
A) reduced market efficiency
B) an increase in the likelihood of moral hazard
C) increase market transactions
D) higher transaction costs
A
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Periods of unusually low production in an economy result in ________ unemployment.
A. frictional B. structural C. cyclical D. environmental
If the percentage change in the quantity demanded of a good is less than the percentage change in price, price elasticity of demand is:
A. elastic. B. inelastic. C. perfectly inelastic. D. unitary elastic.
Among the following, which is the broadest measure of stock prices in the United States?
A) Dow Jones Index B) FT index C) Nikkei Index D) Term Structure Index E) Standard and Poor's 500 Composite Index
Imagine you own a retail mail order business. You produce your catalog, where items and prices are listed, in January and you use the same catalog all year. The central bank in your country increases the money supply by an amount to cause inflation to average one percent each month. Ignoring any seasonality in sales (like the holiday season), what should happen to your sales as the year progresses and why?
What will be an ideal response?