You want to add a new room on your house, but you are not familiar with the local building contractors and are not sure who to consider for the job.
If you ask your friends for referrals, you are using their past experience as a way to evaluate the ________ of the builders. A) efficiency wages
B) moral hazard
C) asymmetric information
D) reputation
Question 2
When the price of wood (which is an input in the production of furniture) falls, the consumer surplus associated with the consumption of furniture
A) increases.
B) decreases.
C) does not change.
D) could be any of the above.
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