The __________ problem in the market for used cars is capable of collapsing the market for __________.
A. adverse selection; good used cars
B. adverse selection; lemons
C. moral hazard; good used cars
D. moral hazard; lemons
Answer: A
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In the long run, a perfectly competitive market produces at ________, whereas the monopolistic competitive firm does not
A) the output at which the lowest average total cost of production is reached B) an output level at which positive economic profits exist C) zero economic profits D) the point at which MR = MC=ATC
An example of the interaction term between two independent, continuous variables is
A) Yi = ?0 + ?1Xi + ?2Di + ?3(Xi × Di) + ui. B) Yi = ?0 + ?1X1i + ?2X2i + ui. C) Yi = ?0 + ?1D1i + ?2D2i + ?3 (D1i × D2i) + ui. D) Yi = ?0 + ?1X1i + ?2X2i + ?3(X1i × X2i) + ui.
The worst and most difficult to extract resources are used first.
Answer the following statement true (T) or false (F)
Rational expectations are forecasts that, although not necessarily correct, are the best that can be made given the available information.
Answer the following statement true (T) or false (F)