An example of moral hazard is
a. people drive as carefully in icy conditions with antilock brakes as without
b. people drive as safely with more airbags as without
c. football players avoid 'spearing' with their heads even with safer helmets
d. people fail to read the medicine warnings more often when self-medicating versus with a doctor's prescription
d
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A country has an aggregate production function of the form: Y = A x K1/3 x H2/3
Which of the following is likely to happen if the capital stock and the efficiency units of labor available to the country increases by 10% over a span of 5 years while the state of technology used in the country remains the same? A) Output will increase by 5%. B) Output will double. C) Output will increase by 10%. D) Output will increase by 1%.
When a perfectly competitive firm experiences positive economic profits
A) the high barriers to entry prevent further competition. B) existing firms exit the industry. C) additional firms enter the industry. D) firms have no incentive to exit or enter the industry.
Use the following graphs for a perfectly competitive market in the short run to answer the next question.
The graphs suggest that in the long run, as automatic market adjustments occur, the demand faced by the perfectly competitive firm will
A. shift up. B. not shift. C. slope downward. D. shift down.
Refer to the information provided in Table 13.3 below to answer the question(s) that follow. Table 13.3Price ($)Quantity4.001003.502003.003002.504002.005001.506001.00700Refer to Table 13.3. If a monopoly faces the demand schedule given in the table, at what level of output is its total revenue maximized?
A. 200 B. 300 C. 500 D. 600