When a jeweler sells a low quality diamond to a young man who believes the diamond is the highest quality, she is engaging in
a. both moral hazard and adverse selection.
b. neither moral hazard nor adverse selection.
c. moral hazard, but not adverse selection.
d. adverse selection, but not moral hazard.
d
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Marginal returns start to decrease when more and more workers _______
A. have to share the same equipment and workspace B. produce less and less output C. require jobs to be too specialized D. produce less and less average product
Which of the following is true?
a. The stock market provides investors with an opportunity to own a fractional share of the firm's future profits. b. A new stock issue is often an excellent way for a firm to raise funds for future expansion. c. Changes in stock prices provide information about what investors think of various business decisions. d. All of the above are true.