According to Okun's law, if full-employment output is $5000 billion, then each percentage point of unemployment sustained for one year reduces output by

If you buy a gift without knowing what a person really wants or needs, you have demonstrated:

A. the incentive problem of gift-giving. B. the necessity-identification problem of gift-giving. C. the knowledge problem of gift-giving. D. the negative trade problem of gift-giving.

Sarah's demand for routine medical visits is q = 10 - 0.2p when she is healthy and q = 20 - 0.2p when she is sick. Medical visits cost $50 each if Sarah has no medical insurance. She is sick 20% of the time. Sarah is considering two different insurance plans. One offers free medical visits; the other plan costs less up front but requires that Sarah pay $5 per medical visit. Compare the two plans

in terms of the trade-off between risk and moral hazard. What will be an ideal response?