Question 1

When one person knows more than another,it creates a situation:

Accepted Answer

A)  called information asymmetry.
B)  in which the transaction is always regretted.
C)  in which the transaction will not occur.
D)  called information dominance.E) All of the above
F) C) and D)

Question 2

Taking action to reveal private information about someone else is called:

Accepted Answer

A)  screening.
B)  signaling.
C)  discriminating.
D)  illegal.E) B) and D)
F) A) and C)

Question 3

The tendency for people to behave in a riskier way or to renege on contracts when they do not face the full consequences of their actions is called:

Accepted Answer

A)  moral hazard.
B)  adverse selection.
C)  counter information.
D)  collective bargaining.E) A) and B)
F) A) and C)

Question 4

Statistical discrimination is when you take action to:

Accepted Answer

A)  reveal private information about someone else.
B)  reveal one's own private information.
C)  find out the opportunity cost of acquiring more information.
D)  fill gaps in your information by generalizing based on observable characteristics.E) A) and C)
F) B) and C)

Question 5

When government mandates participation in a program to solve an information asymmetry problem,it is trying to prevent:

Accepted Answer

A)  adverse selection.
B)  moral hazard.
C)  building a reputation.
D)  illegal screening.E) A) and D)
F) C) and D)

Question 6

A student sending in an application with a writing sample to a college is an example of:

Accepted Answer

A)  signaling.
B)  screening.
C)  building a reputation.
D)  statistical discrimination.E) None of the above
F) C) and D)

Question 7

Consumer Reports' reviews of products:

Accepted Answer

A)  correct an inefficiency in the market.
B)  allow more transactions that are valuable to buyers and sellers to take place.
C)  credibly provide more information to market participants.
D)  All of these statements are true.E) A) and B)
F) A) and C)

Question 8

The presence of adverse selection in a market causes:

Accepted Answer

A)  some transactions fail to take place.
B)  a loss of surplus.
C)  market failure.
D)  All of these statements are true.E) A) and D)
F) A) and C)

Question 9

An insurance company offering high-deductible and low-deductible plans is an example of:

Accepted Answer

A)  screening.
B)  signaling.
C)  statistical discrimination.
D)  building a reputation.E) A) and B)
F) A) and C)

Question 10

Generalizing using statistical discrimination is always:

Accepted Answer

A)  a rational response.
B)  an ethical response.
C)  a legal response.
D)  All of these statements are true.E) All of the above
F) C) and D)

Question 11

Both signaling and screening:

Accepted Answer

A)  are effective ways to increase information available to both parties.
B)  decrease efficiencies in the market.
C)  decrease surplus gained in a market.
D)  All of these statements are true.E) A) and D)
F) B) and D)

Exam 10: Information

When one person knows more than another,it creates a situation:

Correct Answer
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Generalizing using statistical discrimination is always:

Correct Answer
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When government mandates participation in a program to solve an information asymmetry problem,it is trying to prevent:

Correct Answer
verified

Both signaling and screening:

Correct Answer
verified

The tendency for people to behave in a riskier way or to renege on contracts when they do not face the full consequences of their actions is called:

Correct Answer
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Statistical discrimination is when you take action to:

Correct Answer
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Taking action to reveal private information about someone else is called:

Correct Answer
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A student sending in an application with a writing sample to a college is an example of:

Correct Answer
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Consumer Reports' reviews of products:

Correct Answer
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An insurance company offering high-deductible and low-deductible plans is an example of:

Correct Answer
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The presence of adverse selection in a market causes:

Correct Answer
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Exam 10: Information

When one person knows more than another,it creates a situation:

Correct AnswerverifiedShow Answer

Generalizing using statistical discrimination is always:

Correct AnswerverifiedShow Answer

When government mandates participation in a program to solve an information asymmetry problem,it is trying to prevent:

Correct AnswerverifiedShow Answer

Both signaling and screening:

Correct AnswerverifiedShow Answer

The tendency for people to behave in a riskier way or to renege on contracts when they do not face the full consequences of their actions is called:

Correct AnswerverifiedShow Answer

Statistical discrimination is when you take action to:

Correct AnswerverifiedShow Answer

Taking action to reveal private information about someone else is called:

Correct AnswerverifiedShow Answer

A student sending in an application with a writing sample to a college is an example of:

Correct AnswerverifiedShow Answer

Consumer Reports' reviews of products:

Correct AnswerverifiedShow Answer

An insurance company offering high-deductible and low-deductible plans is an example of:

Correct AnswerverifiedShow Answer

The presence of adverse selection in a market causes:

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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