Which firm in an industry is likely to have higher profits? a. ...

[bobypop]

Which firm in an industry is likely to have higher profits?
 a. Sellers with higher costs than their competitors
  b. Sellers with lower costs than their competitors
  c. Sellers with the same costs as their competitors
  d. All of the above

Question 2

Adverse selection in insurance requires that
 a. all people face the same risk
 b. potential customers facing more risk are more interested in purchasing insurance
  c. people are not risk averse
 d. insurers can tell higher risk people from lower risk people

[Meganchabluk]

Answer to Question 1

b

Answer to Question 2

b