This topic contains a solution. Click here to go to the answer

Author Question: Two consequences of asymmetric information are adverse selection and moral hazard. An important ... (Read 186 times)

audie

  • Hero Member
  • *****
  • Posts: 532
Two consequences of asymmetric information are adverse selection and moral hazard. An important distinction between the two is
 
  A) adverse selection exists prior to the completion of a transaction while moral hazard occurs after the transaction is completed.
  B) moral hazard exists prior to the completion of a transaction while adverse selection occurs after the transaction is completed.
  C) moral hazard leads to an inefficient quantity while adverse selection leads to an efficient quantity.
  D) adverse selection leads to an inefficient quantity while moral hazard leads to an efficient quantity.

Question 2

Refer to Figure 4-8. Suppose that instead of a rent ceiling, the government imposed a price floor of 2,000 per month for apartments. What is the value of consumer surplus after the imposition of the price floor?
 
  A) 6,000 B) 30,000 C) 100,000 D) 240,000



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Kaytorgator

  • Sr. Member
  • ****
  • Posts: 345
Answer to Question 1

A

Answer to Question 2

B




audie

  • Member
  • Posts: 532
Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)


bbburns21

  • Member
  • Posts: 336
Reply 3 on: Yesterday
Gracias!

 

Did you know?

People with high total cholesterol have about two times the risk for heart disease as people with ideal levels.

Did you know?

Asthma attacks and symptoms usually get started by specific triggers (such as viruses, allergies, gases, and air particles). You should talk to your doctor about these triggers and find ways to avoid or get rid of them.

Did you know?

Long-term mental and physical effects from substance abuse include: paranoia, psychosis, immune deficiencies, and organ damage.

Did you know?

The National Institutes of Health have supported research into acupuncture. This has shown that acupuncture significantly reduced pain associated with osteoarthritis of the knee, when used as a complement to conventional therapies.

Did you know?

Liver spots have nothing whatsoever to do with the liver. They are a type of freckles commonly seen in older adults who have been out in the sun without sufficient sunscreen.

For a complete list of videos, visit our video library