Adverse selection is
a. when people act differently because they are insured
b. when more risk averse people want to be insured more
c. when people at greater risk want to be insured more
d. when your guess at a test question is wrong
c
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Refer to Figure 19-5. Suppose the pegged exchange rate is $0.14/yuan and U.S. consumers increase their demand for Chinese products. Using the figure above, this would
A) increase the surplus of Chinese yuan. B) decrease the shortage of Chinese yuan. C) decrease the surplus of Chinese yuan. D) increase the shortage of Chinese yuan.
At any point on the LM curve
a. there is labor market equilibrium. b. money supply equals money demand. c. equilibrium output equals potential output. d. both commodity and money market are necessary for equilibrium. e. both b and c.