Asymmetric information can cause a market to go out of existence
Indicate whether the statement is true or false
T It is possible for higher quality products or services to leave the market, because they are unable to receive adequate payments when buyers do not know of their higher quality, until only low quality ones remain and the market for those alone may collapse.
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Consider the budget line in the above figure. If the consumer's income is $240, then the price of a book is
A) $20 per book. B) $24 per book. C) $12 per book. D) More information is needed to determine the price of a book.
If the United States has a net export deficit, which of the following must be true? (Assume that the capital account is zero and net transfers are zero.)
A) Net foreign investment must be negative as well. B) Domestic private saving must be less than net foreign investment. C) Domestic public saving must be less than net foreign investment. D) The balance on the financial account must equal the balance on the current account.