FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 22: Frontiers in Microeconomics

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 1

Short Answer

Review LaterAdd Note

Review Later

Scenario 22-3 ​ Shana owns a boutique that sells high-end women's clothing and accessories. Katie works part-time at the boutique and frequently is the only employee in this small store. Shana pays Katie a wage that is higher than the market wage for this type of job. When the store is not full of customers, Katie diligently works on displays and cleans to keep the store looking its best. Belinda is a customer in the store who asks Katie's opinion on the quality of some jeans she is considering purchasing. Katie tells her the quality is great even though she's had several other customers return them due to flaws. Magda is another customer who is returning a necklace without volunteering that a gem is missing. -Refer to Scenario 22-3. Why do you suppose Shana pays Katie a wage higher than the market wage?

Correct Answer

verified

to avoid a...

View Answer

Show Answer

Question 2

True/False

Review LaterAdd Note

Review Later

Based on studies of human decision making, many people care more about the fairness of a game than about their personal winnings.

A) True
B) False

Correct Answer

verified

Show Answer

Question 3

Short Answer

Review LaterAdd Note

The problem that arises in markets in which the seller knows more about the characteristics of the good being sold than the buyer knows is

How have insights from the field of psychology influenced the thinking of economists in recent years?

An implication of the median voter theorem is that, in a race between Republicans and Democrats,

Most economic models incorporate the assumption of rational behavior on the part of economic actors.

The science of economics is a finished jewel, perfect and unchanging.

An example of signaling is a boyfriend giving an expensive, romantic gift to his girlfriend to convey his love for her.

Which of the following is a lesson from the Condorcet paradox?

People with hidden health problems are more likely to buy health insurance than are other people. This is an example of

One way that employers respond to the moral-hazard problem is by monitoring their employees.

When a night watchman only performs two walk-throughs per night when he is being paid to perform five walk-throughs per night, it is an example of

Economic experiments show that people care more about winning a game than about its intrinsic fairness.

Signaling is an action taken by an uninformed party to induce an informed party to reveal information.

Students of microeconomic principles often say they are going to study "tonight," because the only way to pass the exam is to study some every night. When "tonight" comes, some students choose to do something else. Come exam day, these students do not do well on their exam. This observation is an example of how people are

The median voter theorem states that majority-rule political systems will produce policies that are most preferable for the median voter.​

Studies of human decision making have found that people are reluctant to change their minds.

In his 1951 book Social Choice and Individual Values, Arrow argues that a perfect voting system satisfies all of the following properties except

Assume there are two major political parties: the Conservatives and the Liberals. What does the median voter theorem imply about the nature of the platforms (that is, policy stances) of the Conservatives and Liberals?

Informational asymmetry may apply to a hidden action or hidden characteristic where the informed party may be reluctant to reveal relevant information.