Generalizing using statistical discrimination is:

A. a rational response to being on the wrong end of an information asymmetry.
B. a rational response, although government always steps in to prevent it.
C. an irrational response and always leads to loss of surplus.
D. All of these statements are true.

Answer: A

Economics

You might also like to view...

Suppose that the Fed unexpectedly pursues contractionary monetary policy. What will happen to unemployment in the short run? What will happen to unemployment in the long run? Justify your answer using the Phillips curves

Economics

In traditional economic models, which of the following does NOT describe homo economicus:

A. well-informed. B. impulsive. C. cognitively sophisticated. D. narrowly self-interested.

Economics