The cash reserves held by banks that are illegal are called excess reserves

Which of the following is a possible market solution to the lemons problem?

A) Producers might offer product guarantees and warranties. B) Producers might be required to meet certain legal standards to obtain licenses granting the right to sell their products. C) Government agencies might be charged with directly overseeing production and distribution of certain products. D) Liability laws might be established to ensure that firms selling certain products must face penalties in the event the products function poorly.

Christopher just won tickets to see an NFL football game. His coworker offers to pay him $300 for them, but Christopher decides to use them, even though he would never pay $300 for them himself. Christopher's willingness to consume $300 worth of tickets that he doesn't value at $300 is attributed to:

A. the implicit cost of ownership. B. his refusal to ignore the sunk cost of the tickets. C. the high transactions costs involved in selling the tickets. D. None of these is correct.