Which of the following practices are, at least in part, attempts to reduce moral hazard problems?
a. The income of waiters and waitresses depends heavily on tips.
b. An employer pays below equilibrium wages because he thinks his employees are not working as hard as they could be.
c. The professors leaves the room to prevent cheating on exams.
d. Tenure professors are not supervised closely.
a
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According to the U.S. Secret Service, approximately $2.6 billion of U.S. paper currency in circulation is counterfeit. As long as counterfeit U.S. currency remains undetected and in circulation, an increase in the U.S
inflation rate would essentially A) decrease the real value of the counterfeit currency. B) increase the nominal value of the counterfeit currency. C) increase the real value of the counterfeit currency. D) decrease the nominal value of the counterfeit currency.
Which of the following is NOT true for a perfectly competitive firm?
A) P = MR B) AR = MR C) MR = TR D) P = AR