In which of the following cases did someone use adverse selection?
a. Mr. Wong truthfully told Barbara he did not know how many horsepower his truck had when he sold it to her.
b. Neither Mrs. Lin nor Mr. Hill knew anything about the antique desk in Mrs. Lin’s attic, but they both made up lies about it when Mr. Hill bought it.
c. Miles knew that the boat motor he sold Mr. Sutton had a bad water pump and that Mr. Sutton did not know it, but Miles still did not mention it.
d. Ms. Romano and Mr. Charles are both coin experts who knew exactly the worth of the silver dollar that Ms. Romano sold to Mr. Charles.
c. Miles knew that the boat motor he sold Mr. Sutton had a bad water pump and that Mr. Sutton did not know it, but Miles still did not mention it.
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Given constant returns to scale between labor and output, if it takes 1 hour to make 10 yards of cloth, then 100 yards of cloth can be made in
A) 10 hours. B) 100 hours. C) 1000 hours. D) Can't tell without knowing how much capital is used.
The Smithsonian Agreement of 1971 was hailed by President Nixon as a fundamental reorganization of the international monetary system. In fact, what it accomplished was
A) the revaluation of the dollar. B) the devaluation of the dollar. C) the reduction of the gold content of the dollar. D) the elimination of gold backing for the dollar. E) Both B and C.