Podcast
Questions and Answers
What occurs when people have inaccurate, incomplete, uncertain, or misunderstood data, leading to potentially 'wrong' choices?
What occurs when people have inaccurate, incomplete, uncertain, or misunderstood data, leading to potentially 'wrong' choices?
- Asymmetric information
- Information failure (correct)
- Moral hazard
- Principal-agent problem
What is the term for the situation where buyers and sellers have different amounts of information?
What is the term for the situation where buyers and sellers have different amounts of information?
- Information gap
- Asymmetric information (correct)
- Symmetric information
- Market failure
What is the problem that occurs when being insured makes individuals more careless?
What is the problem that occurs when being insured makes individuals more careless?
- Moral hazard (correct)
- Principal-agent problem
- Adverse selection
- Information failure
What is the term for the situation where the goals of the principals are different from those of the agents?
What is the term for the situation where the goals of the principals are different from those of the agents?
What type of information is necessary for markets to work efficiently?
What type of information is necessary for markets to work efficiently?
What is the consequence of information failure in a market?
What is the consequence of information failure in a market?
What is the term for when one party in a transaction has more information than the other?
What is the term for when one party in a transaction has more information than the other?
What is the term for the problem that arises when the agent's goals are not aligned with the principal's goals?
What is the term for the problem that arises when the agent's goals are not aligned with the principal's goals?
What is the term for the situation where there is incomplete or asymmetric information in a market?
What is the term for the situation where there is incomplete or asymmetric information in a market?
What is an example of a government policy to address information failure?
What is an example of a government policy to address information failure?
What is the purpose of hard-hitting anti-speeding advertising campaigns?
What is the purpose of hard-hitting anti-speeding advertising campaigns?
What is the purpose of consumer protection laws?
What is the purpose of consumer protection laws?
What would cause a contraction of the Production Possibility Frontier (PPF)?
What would cause a contraction of the Production Possibility Frontier (PPF)?
What assumption of rational consumer behaviour states that consumers have fixed and consistent preferences?
What assumption of rational consumer behaviour states that consumers have fixed and consistent preferences?
What is the law that states that as a consumer buys and consumes more units of a good, the extra satisfaction gained diminishes?
What is the law that states that as a consumer buys and consumes more units of a good, the extra satisfaction gained diminishes?
What is the term for the total satisfaction a consumer gets from purchasing units of a good?
What is the term for the total satisfaction a consumer gets from purchasing units of a good?
What is the result of a rational consumer aiming to maximise their total utility?
What is the result of a rational consumer aiming to maximise their total utility?
What is assumed in rational consumer behaviour about the information consumers have?
What is assumed in rational consumer behaviour about the information consumers have?
