With asymmetric information firms might be reluctant to improve the quality of their products because
A) it costs them more to produce the better quality product.
B) they are not able to completely capture the benefits of the improvement.
C) consumers do not value the better product.
D) consumers are better informed about the product and value the new product less.
B
Economics
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For a given amount of total reserves, a decrease in required reserves causes an increase in excess reserves.
a. true b. false
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Generating electricity creates air pollution. This industry, if left unregulated, will produce at an inefficient market equilibrium because
A) there is a deadweight loss. B) supply is not equal to demand. C) too little output is produced. D) the marginal social benefit is greater than the marginal social cost.
Economics