The lemons problem gives the owners of above-average-quality used cars an incentive to:

A. offer a warranty when selling their cars.
B. exaggerate the quality of their cars when selling them.
C. ask for a sales price that is higher than the blue book value of their car.
D. understate the true quality of their cars when selling them.


Answer: A

Economics

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Which of the following best describes the difference between a demand curve and a demand schedule?

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a. True b. False Indicate whether the statement is true or false

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One of the virtues of rising resource prices is they encourage innovation, especially the discovery of other more abundant resources.

Answer the following statement true (T) or false (F)

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According to the Keynesian transmission mechanism, if the Fed conducts an open market sale of government securities, it may cause which of the following in the investment goods market?

A) a rightward shift in the investment demand curve B) a leftward shift in the investment demand curve C) a movement down and along a given investment demand curve D) a movement up and along a given investment demand curve

Economics