Which of the following best describes a situation of moral hazard?
a. Sicker people are more likely to buy health insurance.
b. Prospective used-car buyers have less information about a particular car than its seller does.
c. Drivers with collision insurance drive more recklessly.
d. Drivers with collision insurance wear seatbelts less often.
c
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The largest single portion of state and local budgets is devoted to
A. state and local defense. B. health and public welfare programs. C. state and local unemployment compensation. D. education. E. interest payments on state and local debt.
Why might the tax multiplier be smaller than the expenditure multiplier? Under what circumstances might the reverse be true?
What will be an ideal response?
Explain why a monopoly or a perfectly competitive firm does not consider a rival firm's behavior, but an oligopoly and a monopolistically competitive firm do
What will be an ideal response?
The Federal Trade Commission:
a. was abolished by the Celler-Kefauver Act. b. was established when the Antitrust Division of the Justice Department was eliminated. c. largely deals with utility regulation. d. is a weak and ineffective government agency. e. investigates unfair and deceptive trade practices.