The company that manufactures Screaming Chocolate Zonkers breakfast cereal finds that its sales collapse, it is forced into bankruptcy, and it defaults on its bonds, as a result of information on the filthy conditions in its factory, which had long
been known to management, leaking out to the general public. This incident is best thought of as an example of A) symmetric information in the financial markets.
B) asymmetric information in the financial markets.
C) moral hazard in the financial markets.
D) the generally poor state of sanitation in the food-processing industry in the United States.
B
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What was the Industrial Revolution? How did it contribute to modern economic growth?
What will be an ideal response?
The less elastic a monopolistic competitor's long-run demand curve, the:
A. less its excess capacity. B. higher its price relative to that of a pure competitor having the same cost curves. C. higher its long-run profits. D. lower its average total cost at its equilibrium level of output.