Questions from Managerial Economics

Q: The prisoners’ dilemma is an example of a. a sequential

The prisoners’ dilemma is an example of a. a sequential game b. a simultaneous game. c. a shirking game. d. a dating game.

Q: For threats or commitments to be effective, they must be

For threats or commitments to be effective, they must be a. irrational. b. profitable. c. credible. d. None of the above.

Q: You are taking a multiple-choice test that awards you one

You are taking a multiple-choice test that awards you one point for a correct answer and penalizes you 0.25 points for an incorrect answer. If you have to make a random guess and there are five possib...

Q: Which of the following is not an example of moral hazard?

Which of the following is not an example of moral hazard? a. People are more likely to lock their own car than a rental car. b. Skateboarders attempt more difficult maneuvers when wearing a helmet. c...

Q: Which of the following is true? a. Moral hazard

Which of the following is true? a. Moral hazard is primarily an issue prior to a transaction. b. Adverse selection is primarily an issue after a transaction. c. Moral hazard is the result of an infor...

Q: Restrictive covenants on loans are used to avoid a. moral

Restrictive covenants on loans are used to avoid a. moral hazard. b. adverse selection. c. free riding. d. None of the above

Q: Loan applications require a lot of information from applicants to avoid

Loan applications require a lot of information from applicants to avoid a. moral hazard. b. adverse selection. c. free riding. d. None of the above

Q: Why are contact lens manufacturers reluctant to sell their lenses through the

Why are contact lens manufacturers reluctant to sell their lenses through the Internet? a. The Internet price is too high due to double marginalization b. Search costs are lower, so the Internet sales...

Q: Which of the following is true about moral hazard? a

Which of the following is true about moral hazard? a. Moral hazard arises from actions that cannot be observed. b. Shirking is a form of moral hazard. c. Moral hazard refers to the taking of excessi...

Q: An insurance company offers doctors malpractice insurance. Assume that malpractice claims

An insurance company offers doctors malpractice insurance. Assume that malpractice claims against careful doctors cost $5,000 on average over the term of the policy and settling malpractice claims aga...