A difference between moral hazard and adverse selection is that
a. moral hazard deals with pre-contractually determined public information
b. moral hazard deals with post-contractually determined private information
c. adverse selection deals with pre-contractually determined private information
d. adverse selection deals with post-contractually determined public information
b
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The seller of an option has the ________ to buy or sell the underlying asset while the purchaser of an option has the ________ to buy or sell the asset
A) obligation; right B) right; obligation C) obligation; obligation D) right; right
A competitive, profit-maximizing firm hires workers up to the point where the
a. marginal product equals zero. b. marginal revenue product equals zero. c. marginal product equals the wage. d. value of the marginal product equals the wage.