Suppose an insurance company has estimated that 20 percent of all of its potential policy owners are high-cost and sets a price for their insurance policy with the understanding that 20 percent of its policy owners will be high-cost. If the true percentage of high-cost potential policy owners is 40 percent, the insurance company has set its price too ________ and will have ________ high-cost
policy owners than expected.
A) low; less B) low; more C) high; less D) high; m
B) low; more
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When U.S. Steel, a steel producer, bought control of iron ore companies at the beginning of the 20th century, the company was initiating
A. a vertical merger. B. an expropriation. C. a cartel. D. a horizontal merger.
Related to the Economics in Practice on page 292: The smart phone industry is best characterized as
A. purely competitive. B. a monopoly. C. an oligopoly. D. monopolistically competitive.
Suppose the table below describes the demand for a good produced by monopolist.PriceQuantity$101$92$83$74$65$56$47Based on the data in the table, we know the firm should:
A. be able earn an economic profit. B. not produce the seventh unit. C. not produce the fifth unit. D. produce more than 7 units.
The job loss rate
A) equals 1 minus the job finding rate. B) remains constant over the business cycle. C) rises in recessions. D) rises in expansions.