Progressive Insurance's 'Tripsense' monitors driving patterns of the people who purchase the related insurance policy. This lowers insurance costs because
a. only more reckless drivers will accept the device
b. drivers will want to drive more carefully knowing they are being monitored
c. drivers will believe they can now drive more recklessly
d. it does not affect care in driving
b
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When banks fail during a financial crisis, ________
A) the removal of these weak institutions serves to strengthen the financial system B) the elimination of competitors is likely to spark a credit boom C) there is a loss of information that can cause the crisis to worsen D) surviving banks resort to financial engineering to retain customers
Vertical contracts between manufacturers and retailers often aim to
a. Incentivize the retailers to undertake costly activities, which they otherwise may not realize the full benefits of on their own b. Reward the manufacturer for undertaking the risk inherent in introducing a new product c. Serve as a "signal" of the retailer's belief of the likely success of his product d. All of the above