If a single firm in a price-taker market lowers its price below the market equilibrium price,
a. it will get a larger share of the market.
b. it will lose revenue without increasing the quantity it can sell.
c. other firms will lower their prices.
d. other firms will be driven out of the industry.
B
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Which statement best characterizes the second-best policy offered by a monopoly insurer when it can't observe the consumer's risk?
a. It is a single contract offering partial insurance at an intermediate price such that all types are served. b. It is a menu of contracts providing full insurance for the least risky types and partial insurance for higher risks. c. It is a menu of contracts providing full insurance for the riskiest type and partial insurance at lower prices for lower risks. d. The market breaks down since the monopolist cannot design contracts without observing each consumer's risk.
In the United States, the federal minimum wage in early 2016was:
A. $7.25 per hour. B. $6.50 per hour. C. $8.00 per hour. D. $7.73 per hour.