Question 1
Adverse selection and moral hazard arise because of
◦ asymmetric information.
◦ selection problems.
◦ risk aversion.
◦ mechanism designs for dealing with informational problems.
Question 2
You are in the market for a used 2013 Toyota Corolla. You know that half of the 2013 Corollas are lemons and half are peaches. If you could be assured that the Corolla you were buying was a peach, you would be willing to pay up to $12,000. On the other hand, you would only be willing to pay $4,000 for a lemon. You have no ability to discern whether any particular Corolla is a lemon or a peach. Sellers of Corollas, on the other hand, are likely to know whether their particular car is a lemon or a peach. Suppose sellers of lemons will sell their cars for $3,000 or more and peach sellers will be willing to sell their cars for $9,000 or more. If you are risk neutral, you are willing to offer ________ and ________ are willing to sell you their car.
◦ $4,000 for a car of unknown quality; lemon owners only
◦ $6,000 for a car of unknown quality; lemon owners only
◦ $8,000 for a car of unknown quality; lemon owners only
◦ $9,000 for a car of unknown quality; both lemon and peach owners
Scientist We Lost in 2013
A slave market in Marrakesh, Morocco. This lithograph is from the 1800s.
(A) A brisk half-moon stroke is an efficient technique to use with the body brush or exfoliation ...
Balance the given redox reduction equation in basic solution using the half reaction method
The Cs-131 nuclide has a half-life of 30. years. After 139 years, about 3.0 grams remain. The ...
Iraqi market