If insurance companies are able to gather more and better information on their customers, this will
A) help reduce the problem of adverse selection but do nothing to help with the problem of moral hazard.
B) help reduce the problem of moral hazard but do nothing to help with the problem of adverse selection.
C) help reduce the problems of adverse selection and moral hazard.
D) do nothing to help with the problems of moral hazard and adverse selection.
C
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The aggregate supply curve will be vertical when
a. output can be increased without an increase in the price level b. the economy is operating at full-employment capacity c. output and price level rise together d. the aggregate demand curve shifts to the left e. aggregate demand is absent
Refer to the accompanying figure. For the nation whose PPC is shown, it must be true that:
A. some of the nation's productive resources are better-suited to making milk, and some are better-suited to making movies. B. the nation has a comparative advantage in making milk. C. the nation's productive resources are better-suited to making milk than to making movies. D. the nation's productive resources are better-suited to making movies than to making milk.