Suppose Dave always uses two lemon wedges with his glass of iced tea. Dave's indifference curves for lemon wedges and iced tea are

John is a 55-year-old male smoker, about 50 pounds overweight, who has high blood sugar and drinks to excess a couple of times each month. Because of adverse selection in health insurance,

A) John is less likely to buy health insurance than the average person, because the average person's policy premiums will be based on his risk, not the average risk. B) John is more likely to buy health insurance than the average person, because his policy premiums will be based on the average risk, not his personal risk. C) when John gets health insurance, he will be less likely to take care of himself. D) when John gets health insurance, he will be more likely to take care of himself. E) if John doesn't have health insurance already, he will not be able to get it.

Firm A producing one good acquires another firm B producing another good. The cross price elasticity of demand for the goods owned by each firm is -1.4 . Holding other things constant, the acquiring firm should

a. Raise prices on both goods b. Lower prices on both goods c. Raise price on the acquired good only d. Need more information