In a market with asymmetric information, a good is said to have hidden characteristics if:
A) the consumption of the good imposes an additional cost on the society.
B) the production of the good generates additional benefits to the society.
C) the seller offers secret discounts to some buyers.
D) the buyer or the seller observes something about the good that the other does not.
D
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Refer to Table 16.2. Nominal GDP for Fredonia for 2015 equals
A) $2,750. B) $3,500. C) $4,325. D) $5,500.
Refer to Figure 16-5. Suppose the firm represented in the diagram decides to practice perfect price discrimination. What is the profit-maximizing price it will charge?
A) It should charge a range of prices from $40 to $16. B) It should charge a range of prices from $40 to $12. C) $2 D) $8
The fact that a firm is a price-setter does not ensure it will make a positive economic profit in the short run and over time
Indicate whether the statement is true or false
One piece of evidence that possibly supports the bounded-rationality assumption of behavioral economics is that experiments appear to have shown that
A. total utility is declining when marginal utility is negative. B. people make the same decisions in calm situations than in situations in which emotions come into play. C. people make different decisions in calm situations than in situations in which emotions come into play. D. total utility is maximized when marginal utility is equal to zero.