Question

72) In the market for automobile insurance, adverse selection implies that

A) those who are insured might take greater risks.

B) insured and uninsured alike will take greater risks.

C) those who are uninsured might take greater risks.

D) drivers with greater risks are more likely to buy insurance.

73) Product differentiation

A) means that the monopolistic competitor's product is a close but not a perfect substitute for the products of its competitors.

B) is why a monopolistic competitor faces a downward-sloping demand curve.

C) enables the monopolistic competitor to compete in product quality.

D) All of the above answers are correct.

76) An oligopoly is a market structure in which there are

A) a few products sold by many sellers.

B) only a few sellers selling either an identical or differentiated product.

C) only a few buyers but many sellers.

D) many sellers selling a differentiated product.

77) In perfect competition, ________.

A) there are many firms that sell identical products

B) firms in the market have advantages over firms that plan to enter the market

C) only firms know their competitors' prices

D) there are restrictions on entry into the market

Answer 1

Ans72) the correct option is a) those who are insured might take greater risks.

Ans73) the correct option is D) All of the above answers are correct.

Ans74) the correct option is B) only a few sellers selling either an identical or differentiated product.

Ans75) the correct option is A) there are many firms that sell identical products