Moral hazard occurs when contracts are written in such a way that
A) the interests of agent and principal converge.
B) the interests of agent and principal diverge.
C) agents will wish to maximize the principal's utility.
D) production and risk-bearing efficiency are achieved.
B
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If the level of technology rises, GDP per hour of labor
A) decreases for a given level of capital per hour of labor. B) increases for any level of capital per hour of labor. C) decreases because the level of capital per hour of labor decreases. D) increases because the level of capital per hour of labor increases. E) does not change because GDP increases only when capital or labor increases.
Paul Volcker was appointed to head the Federal Reserve System by ________
A) Richard Nixon in 1969 B) Jimmy Carter in 1979 C) Ronald Reagan in 1992 D) Barack Obama in 2009