Microeconomics

Relative to a competitive labor market, monopsony A) is also efficien

Relative to a competitive labor market, monopsony A) is also efficient. B) creates a deadweight loss because it pays an excessive wage. C) creates a deadweight loss because the wage is below the marginal revenue product of labor. D) creates a deadweight loss because the wage is above the marginal revenue product of labor.   […]

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Date: September 9th, 2020

What is “moral hazard”? What will be an ideal response?

What is “moral hazard”? What will be an ideal response?   ANSWER The risk involved to one party when another party’s behavior changes in a detrimental manner after a contract has been entered into. Usually, this is the result of asymmetric information.  

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Date: September 9th, 2020