One difference between moral hazard and adverse selection is
a. ?Adverse selection is when you choose the wrong answer on a test
b. ?Moral hazard has to do with unobservable characteristics of individuals
c. ?Adverse selection is individuals change their behaviors because of a contract
d. ?Moral hazard has to do with unobservable actions of individuals
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When the rate of interest in the economy increases
A) real Gross Domestic Product (GDP) will increase. B) the market price of existing bonds will fall. C) the asset demand for money will increase. D) the transaction demand for money will increase.
An American insurance company hires a call center in India to handle customer service calls in order to cut costs. Other things equal, this will ________ of the United States
A) decrease the financial account balance B) decrease net exports C) decrease the capital account balance D) increase the current account balance
Nonlinear price discrimination is
A) perfect price discrimination. B) quantity price discrimination. C) group price discrimination. D) two-part pricing.
In-kind transfer payments are _____
a. efficient b. popular with recipients c. paternalistic d. a and b