If a roofer offers a one-year warranty on their work, this is an example of ________.
A) a signal B) a trademark C) profit sharing D) certification
A) a signal
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Under the Sarbanes-Oxley Act of 2002, the provision that gives more funding to the SEC is an example of
A) regulate for transparency. B) supervisory oversight. C) separation of functions. D) socialization of information production.
If the price of oil goes up by 50% and the quantity demanded goes down by 25%, the absolute value of the price elasticity of demand is
A) 0.25. B) 0.50. C) 0.75. D) 1.00.
The demand curve facing a monopolist is
A. perfectly elastic. B. identical the demand curve for a perfectly competitive firm. C. perfectly inelastic. D. downward sloping.
Stocks appear to present risk, yet many people have substantial parts of their wealth invested in them. This behavior could be explained by:
A. investing in stocks over the long run is not as risky as short-term holdings of stocks B. people are not very risk-averse and do not require a risk premium for stocks. C. people are not efficient users of information. D. people are irrational in their investment behavior, only focusing on positive outcomes.