During periods of inflation, which function of money is most severely affected?

Answer the following statements true (T) or false (F)

1. Better Business Bureaus in various cities exist partly in order to try to deal with inadequate buyer information about sellers. 2. A moral hazard problem occurs before a transaction - when people alter their behavior before they sign a contract, imposing costs on the other party. 3. Adverse selection is when someone with home insurance decides to take the chance that a dying tree would fall on the garage, rather than spend the money to have the tree cut down. 4. When the government bails out large banks when the banks become unstable, it could lead to a moral hazard problem.

The figure below shows the production-possibility curves of Canada (AB) and the rest of the world (CD). I1 and I2 are community indifference curves for Canada and the rest of the world. In the absence of trade, the rest of the world produces ________ bales of cotton and ________ bushels of wheat.

A. four; sixteen B. eight; ten C. twelve; eight D. ten; eight