Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:

Measuring "y" on the vertical axis and "x" on the horizontal axis, convexity of indifference curves imply that the magnitude of MRS of "y" for "x"

A) is decreasing as "x" increases. B) is increasing as "x" increases. C) is constant as "x" increases. D) cannot be calculated for large levels of "x".

Lemon laws are an attempt to reduce __________ in used car markets

a. symmetrical information b. adverse selection c. natural selection d. moral hazard e. the winner's curse