Refer to Figure 7.1. When both players act in their best interests, financially, the size of the economic pie is

With money supply shocks in the intertemporal model with money, the price level is

A) procyclical. B) acyclical. C) countercyclical. D) somewhat cyclical.

Which of the following represent examples of adverse selection?

A) Unhealthy people are more likely to want health insurance. B) Careless drivers purchasing extra auto insurance. C) Risk averse individuals choosing to buy extra insurance. D) all of the above E) A and B only