The requirement that all drivers must carry auto insurance reduces
A) moral hazard.
B) the effectiveness of signaling.
C) adverse selection.
D) the chance of auto accidents.
C
You might also like to view...
Refer to Figure 17-9. A follower of the new classical macroeconomics would argue that a contractionary monetary policy to lower inflation after a supply shock, like that pursued by Volcker in 1979, would result in a movement from
A) C to D to A. B) A to C. C) A to D to C. D) A to B. E) C to A.
Under the IMF fixed exchange rate system, a nation running a balance of payments deficit would have an excess __________ its currency in the foreign exchange market and that nation's central bank would have to __________ some of its currency to
maintain the fixed exchange rate. A) supply of; buy B) supply of; sell C) demand for; buy D) demand for; sell
Which one of the following will shift the investment demand curve leftward?
a. A technological breakthrough. b. Lower tax rates. c. Optimistic business expectations. d. A lower rate of capacity utilization. e. None of these.
Why do short-run profits in a perfectly competitive industry tend to disappear over time?