Economics

2 hours ago

Why do insurance companies in many developing countries not offer full health insurance coverage to ...

Why do insurance companies in many developing countries not offer full health insurance coverage to older applicants?

tuggy 4 1 Reply

2 hours ago

How can a buyer of car insurance help in reducing the effects of adverse selection?

tuggy 3 1 Reply

2 hours ago

Why do the owners of good-quality used cars stay away from the market for used cars?

AndrewKraus 4 1 Reply

2 hours ago

Distinguish between two kinds of asymmetric information.

whipped 3 1 Reply

2 hours ago

Which of the following is likely to be used as a signal in the job market?A) The job description B) ...

Which of the following is likely to be used as a signal in the job market?
A) The job description
B) The degree obtained by the applicant
C) The letter of appointment
D) An announcement of vacancy

tuggy 3 1 Reply

2 hours ago

You decide to carry a letter of recommendation from your college professor while going for your ...

You decide to carry a letter of recommendation from your college professor while going for your first interview. This is an example of ________.
A) sniping
B) signaling
C) hedging
D) speculating

AndrewKraus 3 1 Reply

2 hours ago

Samsung provides a warranty for all goods it manufactures to indicate that these goods are of high ...

Samsung provides a warranty for all goods it manufactures to indicate that these goods are of high quality. This is an example of ________.
A) hedging
B) signaling
C) internalizing an externality
D) sniping

AndrewKraus 3 1 Reply

2 hours ago

In order to be useful as a signal in a market with information asymmetry, the signal must be ...

In order to be useful as a signal in a market with information asymmetry, the signal must be ________.
A) easily available
B) inexpensive
C) unique
D) difficult to obtain

tuggy 3 1 Reply

2 hours ago

Which of the following is a prominent solution to adverse selection in used-car markets?A) An ...

Which of the following is a prominent solution to adverse selection in used-car markets?
A) An imposition of a tax on the sale of each unit in the used-car market
B) The imposition of a price ceiling in the used-car market
C) The impos

whipped 3 1 Reply

2 hours ago

Which of the following is an example of signaling in a market with asymmetric information?A) ...

Which of the following is an example of signaling in a market with asymmetric information?
A) Certification of used cars by third parties
B) Rent controls imposed by the government
C) Discounts offered by sellers during the holiday sea

tuggy 3 1 Reply

2 hours ago

Because warranties are potentially ________, low-quality goods are ________ to have warranties.A) ...

Because warranties are potentially ________, low-quality goods are ________ to have warranties.
A) very expensive; less likely
B) inexpensive; less likely
C) very expensive; more likely
D) inexpensive; more likely

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2 hours ago

________ are guarantees of quality issued directly by either the manufacturer or the seller.A) ...

________ are guarantees of quality issued directly by either the manufacturer or the seller.
A) Patents
B) Trademarks
C) Warranties
D) Copyrights

tuggy 3 1 Reply

2 hours ago

A warranty is an example of ________.A) snipingB) signalingC) a price floorD) a price ceiling

A warranty is an example of ________.
A) sniping
B) signaling
C) a price floor
D) a price ceiling

tuggy 3 1 Reply

2 hours ago

Which of the following helps in reducing the problem of adverse selection in health insurance ...

Which of the following helps in reducing the problem of adverse selection in health insurance markets?
A) Insurance mandates
B) High premiums
C) High rates of taxation
D) Insurance coverage

tuggy 3 1 Reply

2 hours ago

________ refers to an action that an individual with private information takes in order to convince ...

________ refers to an action that an individual with private information takes in order to convince others about his information.
A) Sniping
B) Signaling
C) Hedging
D) Speculating

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2 hours ago

Signaling takes place in markets with ________.A) asymmetric informationB) positive externalitiesC) ...

Signaling takes place in markets with ________.
A) asymmetric information
B) positive externalities
C) negative externalities
D) perfect competition

AndrewKraus 3 1 Reply

2 hours ago

Which of the following is a market-based solution to the problem of adverse selection?A) TaxationB) ...

Which of the following is a market-based solution to the problem of adverse selection?
A) Taxation
B) Signaling
C) Sniping
D) Subsidization

AndrewKraus 3 1 Reply

2 hours ago

80% of the total number of people in Genovia with health insurance are above 40 years of age. Which ...

80% of the total number of people in Genovia with health insurance are above 40 years of age. Which of the following economic concepts helps in explaining this fact?
A) The concept of negative externalities
B) The concept of adverse selecti

whipped 3 1 Reply

2 hours ago

________ discourage low-risk individuals from seeking health insurance.A) Low premiumsB) High ...

________ discourage low-risk individuals from seeking health insurance.
A) Low premiums
B) High premiums
C) High costs of medical treatment
D) Low interest rates

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2 hours ago

Health insurance companies often charge high premiums because ________.A) they expect to attract ...

Health insurance companies often charge high premiums because ________.
A) they expect to attract high-risk individuals
B) they expect to attract risk-averse individuals
C) they expect to attract low-income individuals
D) they exp

tuggy 3 1 Reply

2 hours ago

Health insurance markets are likely to attract a disproportionate number of ________ individuals.A) ...

Health insurance markets are likely to attract a disproportionate number of ________ individuals.
A) high-risk
B) risk-seeking
C) low-risk
D) risk-averse

tuggy 3 1 Reply

2 hours ago

Which of the following is a problem that arises in a health insurance market?A) There are a large ...

Which of the following is a problem that arises in a health insurance market?
A) There are a large number of buyers of various insurance programs.
B) There exists a fierce competition between the insurance providers.
C) A disproportion

AndrewKraus 3 1 Reply

2 hours ago

Adverse selection arises in the health insurance market because ________.A) buyers have private ...

Adverse selection arises in the health insurance market because ________.
A) buyers have private information
B) sellers have private information
C) different firms provide different insurance schemes
D) the number of buyers and se

whipped 3 1 Reply

2 hours ago

In which of the following markets are buyers likely to have private information?A) The market for ...

In which of the following markets are buyers likely to have private information?
A) The market for used cars
B) The market for fresh fruits and vegetables
C) The market for banking services
D) The market for health insurance

whipped 3 1 Reply

2 hours ago

A factory urgently needs to hire some workers. The factory owner is willing to pay a wage of $15 per ...

A factory urgently needs to hire some workers. The factory owner is willing to pay a wage of $15 per hour to responsible workers and is unwilling to hire workers who require constant monitoring. On average, he expects 5 out of 10 workers who have com

tuggy 3 1 Reply

2 hours ago

Refer to the scenario above. In this case, how much should Tom pay for a used iPhone?A) $80B) $40C) ...

Refer to the scenario above. In this case, how much should Tom pay for a used iPhone?
A) $80
B) $40
C) $60
D) $0

tuggy 3 1 Reply

2 hours ago

Refer to the scenario above. Which of the following problems is likely to occur in this market?A) ...

Refer to the scenario above. Which of the following problems is likely to occur in this market?
A) The fallacy of composition
B) Moral hazard
C) Adverse selection
D) The free-rider problem

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2 hours ago

A fruit retailer buys 50 pounds of apples from the wholesale market every day. The retailer has ...

A fruit retailer buys 50 pounds of apples from the wholesale market every day. The retailer has observed that 20% of the apples bought each time are not of good quality. Because it is not possible for the retailer to check each apple before buying, h

AndrewKraus 3 1 Reply

2 hours ago

What is likely to happen in a used-car market if the buyers feel that the best they can do is to buy ...

What is likely to happen in a used-car market if the buyers feel that the best they can do is to buy a lemon?
A) The sellers of gems reap high profits.
B) Higher gains from trade are realized.
C) The entire market shuts down.
D) T

tuggy 4 1 Reply

2 hours ago

Which of the following is an example of adverse selection?A) Overgrazing of a common piece of landB) ...

Which of the following is an example of adverse selection?
A) Overgrazing of a common piece of land
B) Passengers travelling in a subway without a ticket
C) A customer buying a defective appliance from a used goods market
D) The g

tuggy 4 1 Reply

2 hours ago

Which of the following is true of a used-car market?A) Sellers have more information than the ...

Which of the following is true of a used-car market?
A) Sellers have more information than the buyers.
B) Gains from trade do not exist in this market.
C) The cars sold are identical in quality.
D) There is no consumer surplus in

AndrewKraus 4 1 Reply

2 hours ago

In a market with information asymmetry, gains from trade occur if:A) the value of the good to the ...

In a market with information asymmetry, gains from trade occur if:
A) the value of the good to the seller is greater than its value to the buyer.
B) the value of the good to the buyer is greater than its value to the seller.
C) the var

tuggy 3 1 Reply

2 hours ago

Information asymmetry in a market can lead to ________.A) a market failureB) the paradox of thriftC) ...

Information asymmetry in a market can lead to ________.
A) a market failure
B) the paradox of thrift
C) the free-rider problem
D) a tragedy of the commons

tuggy 3 1 Reply

2 hours ago

Mr. Smith put his laptop up for sale. He is aware of the fact that the laptop malfunctions ...

Mr. Smith put his laptop up for sale. He is aware of the fact that the laptop malfunctions frequently. However, none of the potential customers who came to buy the laptop were able to discover the problem and one of them actually bought it at a remun

whipped 3 1 Reply

2 hours ago

Claudia went to a department store to buy a few things for her new house. She found out that several ...

Claudia went to a department store to buy a few things for her new house. She found out that several items in the store were on discount and decided to make the most of the deals offered. However, as she started using the things that she bought, she

whipped 3 1 Reply

2 hours ago

You went to a craft show and paid an exorbitant price for an embroidered shawl that the seller said ...

You went to a craft show and paid an exorbitant price for an embroidered shawl that the seller said was hand-embroidered and had been imported from India. Several months later, you find a similar shawl in another showroom at a much lower price and fo

whipped 3 1 Reply

2 hours ago

________ occurs when one agent in a transaction knows about a hidden characteristic of a good.A) The ...

________ occurs when one agent in a transaction knows about a hidden characteristic of a good.
A) The free-rider problem
B) The tragedy of the commons
C) Adverse selection
D) Moral hazard

whipped 3 1 Reply

2 hours ago

In a market with asymmetric information, hidden actions exist if:A) the buyer or the seller takes ...

In a market with asymmetric information, hidden actions exist if:
A) the buyer or the seller takes actions that are relevant for but not observed by, the other party.
B) the production or consumption of the good being transacted gives rise

AndrewKraus 3 1 Reply

3 hours ago

In a market with asymmetric information, a good is said to have hidden characteristics if:A) the ...

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.

whipped 3 1 Reply