Discuss policy with respect to the problem of moral hazard

Assignment Help Microeconomics
Reference no: EM13902717

A major university bans the assignment of D or F grades. It defends its action by claiming that students tend to perform above average when they are free from the pressures of flunking out. The university states that it wants all its students to get As and Bs. If the goal is to raise overall grades to the B level or above, is this a good policy? Discuss this policy with respect to the problem of moral hazard.

Reference no: EM13902717

Questions Cloud

How does truth in advertising promote competition : To promote competition and consumer welfare, the Federal Trade Commission requires firms to adver- tise truthfully. How does truth in advertising promote competition? Why would a market be less competitive if firms advertised deceptively?
Is the policy likely to create a moral hazard problem : Faced with a reputation for producing automobiles with poor repair records, a number of American companies have offered extensive guarantees to car purchasers. In light of your knowledge of the lemons market, why is this a reasonable policy?
Should he be allowed to continue exclusively with research : Professor Jones has just been hired by the economics department at a major university. The president of the board of regents has stated that the university is com- mitted to providing top-quality education for under- graduates. Two months into the..
Why president truman decided to drop atomic bomb on japan : why President Truman decided to drop the atomic bomb on Japan
Discuss policy with respect to the problem of moral hazard : The university states that it wants all its students to get As and Bs. If the goal is to raise overall grades to the B level or above, is this a good policy? Discuss this policy with respect to the problem of moral hazard.
How could market signals, reputation to make comparisons : Gary knows very little about the difference between makes and models. How could he use market signals, reputation, or standardization to make comparisons?
Can a brand name provide a useful signal of quality : Many consumers view a well-known brand name as a signal of quality and will pay more for a brand-name product (e.g., Bayer aspirin instead of generic aspirin, or Birds Eye frozen vegetables instead of the super- market's own brand). Can a brand na..
What is an efficiency wage : What is an efficiency wage? Why is it profitable for the firm to pay it when workers have better information about their productivity than firms do?
Which is the goal of the firm shareholders : Joe earned a high grade-point average during his four years of college. Is this achievement a strong signal to Joe's future employer that he will be a highly productive worker? Why or why not?

Reviews

Write a Review

 

Microeconomics Questions & Answers

  The second order partial derivative f21

If a function f(x1,x2) is not additively separable, then the second order partial derivative f12 will be different from the second order partial derivative f21? True or False?

  Define microsoft as a monopoly

Microsoft has been a giant in the software industry. Can we define Microsoft as a monopoly? Please describe. In addition, whether the Learner Index works well to define the market power for Microsoft in the software industry? Describe your answer.

  Equilibrium wage and employment if the market is free

Suppose the labour market in the house cleaning industry in Quebec City can be described by the following demand and supply equations: LD = 400 - 10w and LS = 40 + 20w. Calculate the equilibrium wage and employment if the market is free.

  Trade restrictions effects on exchange rates

Trade Restrictions Effects on Exchange Rates. Suppose that the Japanese government relaxes its controls on imports through Japanese firm.

  What managerial actions can cause workplace conflict

As a project manager, dealing with conflict is part of the job. There are many sources of conflict; one source that is often overlooked is the manager. Based on the Week 4 reading and lecture, what managerial actions can cause workplace conflict.

  Characterize the adam smith’s concept of “invisible hand”

Which statement best characterizes Adam Smith’s concept of the “invisible hand”. Those who don’t work shouldn’t eat or else.

  Share resources to achieve a mutually beneficial objective

One way to think about this is if there is one company who manufactures a product and allows another company to utilize the exact same resources to manufacture the product to sell in a different market that the current company does not currently util..

  Calculate the 2006 all cause age-adjusted mortality rates

Calculate the 2006 all cause age-adjusted mortality rates for males and females for the United States using the direct and indirect method of age adjustment.

  What are primary principles involved in community building

What are the primary principles involved in community building? Describe what is meant by enhancing a community's strengths and what kinds of efforts would be involved in working toward positive change.

  Evaluate the financial statements and the financial position

Evaluate the financial statements and the financial position of health care institutions and describe the overall planning process and the key components of the financial plan.

  Examine a perfectly competitive firm

Examine a perfectly competitive firm that you have recently purchased a product from, focusing specifically on how the firm operates relative to the characteristics of the market.

  Methamphetamine meth is an addictive synthetic drug made

methamphetamine meth is an addictive synthetic drug made chiefly in small toxic labs stls in homes tents barns or hotel

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd