In a market with asymmetric information, hidden actions exist if: ...

[jake]

In a market with asymmetric information, hidden actions exist if:
 
  A) the buyer or the seller takes actions that are relevant for but not observed by, the other party.
  B) the production or consumption of the good being transacted gives rise to positive externalities.
  C) the production or consumption of the good being transacted gives rise to negative externalities.
  D) the production of the good being transacted involves a huge opportunity cost.

Question 2

Potential GDP is reached when
 
  A) unemployment is zero.
  B) there is no cyclical unemployment.
  C) unemployment is above full employment.
  D) unemployment is below full employment.
  E) the natural unemployment rate equals zero.

[karlss]

Answer to Question 1

A

Answer to Question 2

B