The process by which sellers send signals to buyers conveying information about product quality is known as: A) asymmetric information. B) market signaling. C) a lemons problem. D) moral hazard. ANSWER B
Date: September 9th, 2020
A perpetuity for sale at $100,000 that promises a yearly payment of $5,000 has an effective yield of A) 2%. B) 5%. C) 20%. D) 50%. E) 2,000%. ANSWER B
Date: September 9th, 2020
Studies generally agree that there are 10-15 million people in the “underclass.” Indicate whether the statement is true or false ANSWER F
Date: September 9th, 2020
A production function in which the inputs are perfectly substitutable would have isoquants that are A) convex to the origin. B) L-shaped. C) linear. D) concave to the origin. ANSWER C
Date: September 9th, 2020
See Scenario 4.5. The Engel curve for grilled cheese sandwiches is: A) downward sloping. B) horizontal. C) upward sloping. D) none of the above ANSWER C
Date: September 9th, 2020
In the short run, a perfectly competitive firm earning negative economic profit A) is on the downward-sloping portion of its AVC. B) is at the minimum of its AVC. C) is on the upward-sloping portion of its AVC. D) is not operating on its AVC. E) can be at any point on its AVC. […]
Date: September 9th, 2020
See Scenario 4.5. If P = $1,000, the price elasticity of demand: A) is 0, B) is negative infinity. C) is -0.18. D) cannot be determined without knowing I and Ph. ANSWER C
Date: September 9th, 2020
The limited savings of the poor is evidence of the flawed character of the poor. Indicate whether the statement is true or false ANSWER F
Date: September 9th, 2020
A warranty is most valuable as a signaling device when A) the buyer has much more information about the product than the seller does. B) the seller has much more information about the product than the buyer does. C) the buyer has much more information about his or her own preferences than the seller does. […]
Date: September 9th, 2020
The marginal rate of technical substitution is equal to the A) slope of the total product curve. B) change in output minus the change in labor. C) change in output divided by the change in labor. D) ratio of the marginal products of the inputs. ANSWER D
Date: September 9th, 2020
