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Author Question: The problems posed by special interests are unaffected by fiscal federalism. a. True b. ... (Read 55 times)

Zoey63294

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on: Jul 1, 2018
The problems posed by special interests are unaffected by fiscal federalism.
 
  a. True b. False

Question 2

Adverse selection occurs when an agreement encourages undesirable behavior.
 
  Indicate whether the statement is true or false


kbennett34

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Reply #1 on: Jul 1, 2018
Answer to Question 1

b

Answer to Question 2

False. This is a moral hazard. Adverse selection occurs if the offer to make an agreement attracts a certain type person who undertakes the undesirable behavior anyway.


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