As of mid-2009, the unemployment rate for blacks is approximately 1.7 times the rate for

What happens when the Fed sells government bonds?

A) The money supply tends to rise. B) The money supply tends to remain unchanged. C) The money supply tends to fall. D) The U.S. budget deficit necessarily rises.

Which of the following best illustrates the adverse selection problem?

A) a professional football team that consistently drafts poor players B) an economic agent who engages in risky behavior once a loan is received C) an individual who hides a pre-existing condition from a health insurer D) an individual who experiences a lost of income by not working while attending college