Consider a market in which high-quality and low-quality television sets are sold. Before consumers make a purchase, they do not know the quality of the sets, but the sellers do know
As compared to a situation where both consumers and sellers know the quality of the sets, this situation would A) cause no change in the ratio of low to high-quality sets sold.
B) increase the fraction of high-quality sets sold.
C) increase the fraction of low-quality sets sold.
D) cause the average price of goods sold to rise.
C
You might also like to view...
If interest rates in Canada rise above those in the rest of the world, then
a. the demand for Canadian dollars decreases b. exports from Canada to other countries increases c. imports into Canada from other countries decreases d. it raises Canada's exchange rate and this may result in a deficit on Canada's current account e. the balance of payments becomes negative
In an open economy, the source of the demand for loanable funds is
a. national saving b. national saving + net capital outflow c. investment + the government budget deficit d. investment + net capital outflow