Adverse selection occurs in the health insurance market because:
A. it is difficult for insurance companies to distinguish between high risk and low risk customers.
B. people cannot predict their future health status.
C. the least healthy people are the least likely to acquire insurance.
D. health care markets are unregulated.
Answer: A
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The price elasticity of demand for electricity is -0.40. By how much must the price of the electricity decrease in order for sales to rise by 12%?
a. 3%. b. 4.8%. c. 12.4%. d. 30%.
Your company discovers a better way to produce mousetraps, but your better methods are not apparent from the mousetraps themselves. Your knowledge of how to more efficiently produce mousetraps is
a. common technological knowledge. b. common, but not technological, knowledge. c. proprietary technological knowledge. d. proprietary, but not technological, knowledge.
The relationship between the level of income and investment spending is known as the consumption function.
Answer the following statement true (T) or false (F)
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. The economy is currently at Point A. The opportunity cost of moving from Point A to Point B is the
A. 30 LCD televisions that must be forgone to produce 60 additional OLED televisions. B. 90 LCD televisions that must be forgone to produce 20 additional OLED televisions. C. 30 LCD televisions that must be forgone to produce 20 additional OLED televisions. D. 120 LCD televisions that must be forgone to produce 40 additional OLED televisions.