Moral hazard encourages people to take risks
a. True
b. False
Indicate whether the statement is true or false
True
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Borrowed funds are used in financing every component of GDP.
Answer the following statement true (T) or false (F)
Perfectly competitive markets:
A. tend to have relatively few sellers. B. are more of an idealized model economists use than a real-life occurrence. C. tend to have relatively few buyers. D. are the most common type of market in the United States.
Refer to the following payoff matrix:Player 1Player 2??Low QHigh Q?Low Q$50,$5$15,$30?High Q$40,$2$2,$1Suppose the production game depicted in the payoff matrix is a sequential-move game. Identify the strategy leading to a first-mover advantage for player 1.
A. Player 1 moves first and plays Low Q. Observing player 1's move, player 2's best response is to play High Q. B. Player 1 moves first and plays High Q. Observing player 1's move, player 2's best response is to play Low Q. C. Player 1 moves first and plays Low Q. Observing player 1's move, player 2's best response is to play Low Q. D. Player 1 moves first and plays High Q. Observing player 1's move, player 2's best response is to play High Q.
All of the following are ways a business can earn economic profits except
A. Find new and better methods of production. B. Take above-average risks. C. Discover new products. D. Maximize implicit costs but not explicit costs.