Refer to figure 5 1 at the market equilibrium a the

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Chapter 17 / Exercise 54
Exploring Microeconomics
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86)Refer to Figure 5-1.At the market equilibrium,A) the marginal cost is less than the marginal benefit.B) the marginal cost is greater than the marginal benefit.C) the marginal cost is equal to the marginal benefit.D) the marginal cost is zero.Answer: A
86)
Page Ref: 230/160Learning Outcome: Micro-21: Describe methods for countering and avoiding risk.87)Refer to Figure 5-1.At the market equilibrium, the deadweight loss is equal to
Page Ref: 230/160Learning Outcome: Micro-21: Describe methods for countering and avoiding risk.17
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Exploring Microeconomics
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Chapter 17 / Exercise 54
Exploring Microeconomics
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88) Some economists have argued that certain characteristics of the delivery of health care justifygovernment intervention. One of these characteristics is
88)
Page Ref: 231/161Learning Outcome: Micro-23: Discuss the economics of public goods and common resources.89) Under current tax law individuals do not pay taxes on health insurance benefits they receivefrom their employers. As a result,
89)
Page Ref: 232/162Learning Outcome: Micro-23: Discuss the economics of public goods and common resources.TRUE/FALSE. WriteʹTʹif the statement is true andʹFʹif the statement is false.90) Adverse selection is a situation in which one party to an economic transaction has lessinformation than the other party.90)Answer:TrueFalse
Page Ref: 226/156Learning Outcome: Micro-21: Describe methods for countering and avoiding risk.91) One consequence of adverse selection in the market for used cars is that most used cars sold willbe lemons.91)
Page Ref: 226/156Learning Outcome: Micro-21: Describe methods for countering and avoiding risk.92) Insurance companies use deductibles and coinsurance to reduce moral hazard.92)
Page Ref: 229/159Learning Outcome: Micro-21: Describe methods for countering and avoiding risk.93) Under current U.S. tax laws, individuals do not pay taxes on health insurance benefits theyreceive from their employers.93)
Page Ref: 232/162Learning Outcome: Micro-23: Discuss the economics of public goods and common resources.94) The situation in which one party to a transaction takes advantage of knowing more than theother party to the transaction is known as adverse selection.94)Answer:TrueFalse
Page Ref: 226/156Learning Outcome: Micro-21: Describe methods for countering and avoiding risk.18

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