You may be unwilling to buy a used car because you suspect the last owner found out the car was a lemon. You may treat a car you rented with a little less care than you would use on your own car
a. Both examples primarily illustrate adverse selection.
b. Both examples primarily illustrate moral hazard.
c. The first example primarily illustrates adverse selection; the second primarily illustrates moral hazard.
d. The first example primarily illustrates moral hazard; the second primarily illustrates adverse selection.
c
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Answer the following statement true (T) or false (F)
1) Logrolling can either increase or diminish economic efficiency. 2) Even if a majority of the population wants a law and the law is passed, the outcome may still be economically inefficient. 3) The paradox of voting is that under majority voting rules the median voter decides the election outcome. 4) Majority voting assures that government will provide a public good if it yields total benefits in excess of total costs.
One World View article is titled "Global Depression." The countries that experienced the Depression
A. Experienced higher employment levels than previously recorded. B. Suffered substantial losses of output and employment. C. Experienced high unemployment but an increase in output. D. Experienced GDP growth but at a rate below the long-term trend.