A difference between moral hazard and adverse selection is that
a. moral hazard deals with pre-contractually determined public information
b. moral hazard deals with post-contractually determined private information
c. adverse selection deals with pre-contractually determined private information
d. adverse selection deals with post-contractually determined public information
b
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Hughes and Cain (2011) ask: Who suffered from the tariff in the 19th century? What was their answer?
(a) the government (b) producers of import-competing goods (c) consumers (d) workers in import-competing industries
With time, which one of the following strategies would most likely result in an outward shift in the production possibilities curve of an economy?
a. passage of legislation reducing the workweek to 30 hours. b. instituting a tax policy encouraging consumption at the expense of investment. c. instituting a tax policy encouraging investment at the expense of consumption. d. an increase in the marginal income tax rate, which would reduce the work effort of individuals.