What is the most important dimension of capital and how does that relate to its value?
What will be an ideal response?
The most important dimension of capital is that it exists through time. Therefore, its value is only as great as the value of the services it will render over time.
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Asymmetric information can lead to the ________-informed parties to try to take advantage of the ________-informed parties, which can cause ________.
A) better; less; moral hazard, but not adverse selection B) better; less; moral hazard and adverse selection C) less; better; adverse selection, but not moral hazard D) less; better; moral hazard, but not adverse selecti
The "invisible hand" works to promote general well-being in the economy primarily through
a. government intervention. b. the political process. c. people's pursuit of self-interest. d. altruism.
A Pigouvian tax corrects for
A. market congestion. B. market losses. C. inefficient sales. D. low market prices.
If MR > MC for a competitive firm, it should raise its price and increase its level of output.
Answer the following statement true (T) or false (F)