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Which of the following is NOT an example of adverse selection
A. A business bets the proceeds of a bank loan on the over/under of the next NFL game
B. An accident-prone driver buys auto insurance
C. A patient with a terminal illness buys life insurance
D. A hungry person goes to the all-you-can-eat buffet
Why does the assumption of independence of risks matter in the examples of insurance. Illustrate what would happen to premiums if the probabilities of house.
When would it make sense for a factory that is losing money to remain in operation
The case for the Federal Reserve independence includes the idea that
Answer the same questions as in the previous problem if TC = .5m + 10Q. In which problem are economies of scale more important? Explain how this affects your outsourcing decision.
Consider a rancher-farmer economy. Assume that the rancher has no choice over how many cows to raise but either the farmer or the rancher (or both) can build a fence to eliminate the crop damage of $150. However, the costs of installing the fence are..
In 2010, and 2011, the government of Greece risked defaulting on its debt due to a severe budget crisis. Using bond market graphs as shown in class show the effect on the risk premium between U.S. Treasury debt and comparable maturity Greek debt. Ple..
Prestige pricing objectives emphasize
You are standing in line. Think about what you would be doing if you are not in this line. The alternatives are infinite and computing the cost of them all is impossible. However, since you could only be doing one thing (not all of them) if you are n..
The U.S. government pays an economist at the U.S. Department of Commerce $50,000 in salary in 2006. The economist then retires. In 2007, the government pays him $30,000 in retirement benefits. The 2006 payment is included in 2006 GDP as government pu..
the microeconomic paper tests your ability to apply economic principles to a business decision. select one situation
Research the concept of an open economy. Now consider the United States' current economic situation. Share your overall opinion of the subject and if you believe the U.S. economy has benefited or suffered (or both).
At the profit-maximizing quantity, what is the average total cost of producing e-books.
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