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
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Which of the following best describes the difference between a demand curve and a demand schedule?
A) A demand curve shows different quantities of a good demanded at different prices, whereas a demand schedule shows different quantities of a good demanded at different incomes. B) A demand curve can be derived from a demand schedule, but a demand schedule cannot be derived from a demand curve. C) A demand curve shows different quantities of a good demanded at different incomes, whereas a demand schedule shows different quantities of a good demanded at different prices. D) A demand curve is a graphical representation of the relationship between the quantity of a good and its price, whereas a demand schedule is a tabular representation.
Models are used to describe cause-and-effect relationships
a. True b. False Indicate whether the statement is true or false
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)
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