A lender faces a(n) ________ problem if borrowers with a greater chance of defaulting on their loans get loans from the lender.
A. adverse selection
B. free?rider
C. external cost
D. moral hazard
Answer: A
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The primary mission of the World Bank today is to
A) provide capital to underdeveloped countries. B) provide capital to firms around the world. C) provide financial assistance for the reconstruction of war-damaged nations. D) provide a safe place for people around the world to put their money. E) help countries manage their exchange rates.
Which of the following is the best example of a public good?
a. a national system of healthcare b. an amusement park c. city street lights d. telephone service
The European Union crisis was caused by:
a. Too little state spending b. The fact that all EU members are on the euro c. industrial planning d. excessive government spending by weak economies e. all of the above
One of the arguments in favor of trade restrictions is the foreign export subsidies argument
Indicate whether the statement is true or false