Asymmetric information occurs when
A) buyers and sellers are not equally informed about the true quality of what they are buying and selling.
B) banks face an adverse selection problem with their borrowers.
C) borrowers covertly engage in activities that increase the probability of poor performance.
D) All of the above.
D
You might also like to view...
Refer to the figure above. If A forms a customs union with B, the value of trade diversion will be
A) $0. B) $10,000. C) $20,000. D) $40,000.
Refer to the above figure. Which panel is consistent with the Fed buying bonds?
A) Panel A B) Panel B C) Panel C D) Panel D
Marcus says that he would smoke one pack of cigarettes each day regardless of the price. If he is telling the truth, Marcus's
a. demand for cigarettes is perfectly inelastic. b. price elasticity of demand for cigarettes is infinite. c. income elasticity of demand for cigarettes is 0. d. More than one of the above is correct.
Which of the following made tying contracts illegal and banned price discrimination with the intent to monopolize?
A. the Clayton Act B. the Cellar-Kefauver Act C. the Federal Trade Commission Act D. the Sherman Act