Jack and Diane each buy pizza and paperback novels. Pizza costs $3 per slice, and paperback novels cost $5 each. Jack has a budget of $30, and Diane has a budget of $15 to spend on pizza and paperback novels. Which consumer(s) can afford to purchase 3 slices of pizza and 4 paperback novels?

Which of the following is true?

a. International trade makes it possible for a country's consumption possibilities to exceed its production possibilities. b. International trade requires that a country's production possibilities exceed its consumption possibilities. c. A country's production possibilities always equal its consumption possibilities. d. A country's consumption possibilities can never equal its production possibilities because of leakages in the system. e. As long as there is full employment of resources, a country's production possibilities will exceed its consumption possibilities even with trade.

When the buyer knows less than the seller about the characteristics of the good being sold, there is

a. a principal-agent problem. b. a moral hazard problem. c. an adverse selection problem. d. a signaling problem.