If you are willing to purchase a house for 500,00 . and you purchase the house for 500,00 . , this ...

If you are willing to purchase a house for 500,00 . and you purchase the house for 500,00 . , this transaction will generate:
 a. There is no surplus created
  b. 0 worth of seller surplus and unknown amount of buyer surplus
  c. 0 worth of buyer surplus and unknown amount of seller surplus
  d. Not information provided

QUESTION 2

Which of the following can a firm use to reduce competition in the market?
 a. Locking in customers to long term contracts
  b. Seek an exclusive government contract
 c. Acquire patents
 d. All the above

QUESTION 3

If the company can correctly anticipate the adverse selection, what premiums would it charge?
 a. 2500
  b. 2600
  c. 1000
  d. 1100

QUESTION 4

If you are willing to purchase a house for 300,00 . and you purchase the house for 275,000 . this transaction will generate:
 a. There is no surplus created
  b. 25,00 . worth of seller surplus and unknown amount of buyer surplus
  c. 10,00 . worth of buyer surplus and 15,00 . of seller surplus
  d. 25,00 . worth of buyer surplus and unknown amount of seller surplus

QUESTION 5

All of these allow a firm to differentiate its product, except
 a. Product branding
 b. Reducing quality
 c. Advertising
 d. Limiting availability

QUESTION 6

Suppose the insurance company cannot tell them apart but expects them to be different values and charges them an average premium of 1850 . How much profit would it make?
 a. 1850
 b. Zero-they would break even
 c. They would make a loss of 650
  d. They would make a loss of 1100

QUESTION 7

If you are willing to sell your car business for 500,00 . and someone offers you 420,00 . for it, this transaction will generate:
 a. There is no surplus created
  b. 80,00 . worth of seller surplus and unknown amount of buyer surplus
  c. 40,00 . worth of buyer surplus and 40,00 . of seller surplus
  d. 80,00 . worth of buyer surplus and unknown amount of seller surplus