Signals solve the adverse selection problem
A) if the signal is an advertisement placed in the New York Times or other top-tier publication.
B) only if the signal is viewed as credible.
C) when the signal is expensive to produce.
D) if the signaling firm is known to be a profit-maximizer.
B
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One result of voters' rational ignorance is that
a. cyclical majorities are more common b. vote trading is common c. majority rules d. special interests often dominate legislation e. members of Congress go along with whatever their constituents want
All of the following are preconditions for economic growth EXCEPT
i. property rights. ii. democracy. iii. free markets. A) i only B) ii only C) iii only D) Both i and ii E) i, ii, and iii
What is microfinance?
What will be an ideal response?
Due to automatic stabilizers, when income rises, government transfer spending:
A. and tax revenues increase. B. increases and tax revenues decrease. C. and tax revenues decrease. D. decreases and tax revenues increase.