Suppose a plaintiff hires a lawyer to represent her in a court case. The lawyer will be paid by the hour. Under this contract,
A) production efficiency is not achieved.
B) the client bears all of the risk.
C) the lawyer has an incentive to lie about his hours worked.
D) All of the above.
D
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Which of the following characteristics does not fit a perfectly competitive market?
A. Numerous small firms B. Identical products produced by all firms in the market C. Each individual firm has a small amount of control over the market price D. Ease of entry and exit from the market
A general rule is that an economy is experiencing a recession when
A. real GDP declines for at least three months. B. real GDP declines for at least nine months. C. nominal GDP declines for at least nine months. D. real GDP declines for at least six months.
In the short run, a firm should exit the industry if its marginal cost exceeds its marginal revenue
a. True b. False Indicate whether the statement is true or false
Figure 9.6 represents the market for health insurance. Suppose there are two types of consumers, low-cost consumers with $2,000 average medical expenses per year, and high-cost customers with $4,000 average medical expenses per year. Initially the insurance companies estimate that 40% of its customers are high-cost type. Compared to the outcome with pessimistic expectations, how many more customers buy health insurance?
A. 500 B. 1,300 C. 1,500 D. 1,600