Week 13 - TUTORIAL 12 WEEK 13 ECONOMICS OF INFORMATION PRE...

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TUTORIAL 12 WEEK 13 ECONOMICS OF INFORMATION PRE EXAM REVIEW Reading Text: Ch 14 Ch14: Problems: 1, 2, 3, 5, 6 and 7 1 a False. The information imparted by the expense of the advertisement, not the message itself, is the more reliable signal of high quality. The producer of a product who knew that consumers would be unlikely to buy its product a second time would gain little by spending millions to induce them to try it. b True. Because charging non-buyers for advice is often impractical, the market generally provides less than the socially optimal amount of retail service. c False. The best-attired lawyer will not always be the best lawyer. You should follow this selection strategy only when you have no more reliable information about the quality of the lawyers. d True. The benefit of searching in a large city is greater, because there is a greater range of potential spouses to choose from. 2
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Week 13 - TUTORIAL 12 WEEK 13 ECONOMICS OF INFORMATION PRE...

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