Exam 22: Frontiers in Microeconomics.

The field of political economy

Suppose a group of people read an article on capital punishment.Prior to reading the article,60% of the members of the group were opposed to capital punishment,while 40% of the members of the group were in favor of capital punishment.According to studies of human decision-making,which of the following is likely?

Scenario 22-5 Three members of the DiCarlo family, Vinny, Maria, and Franki, are choosing the entree for a large family reunion. Their options are: spaghetti, ravioli, lasagne, and pizza. Vinny prefers spaghetti over lasagne, lasagne over ravioli, and ravioli over pizza. Maria prefers ravioli over spaghetti, spaghetti over pizza, and pizza over lasagne. Frankie prefers pizza over ravioli, ravioli over lasagne, and lasagne over spaghetti. -Refer to Scenario 22-5.Vinny recommends using a vote by majority rule and wants to be sure that his first choice becomes the winner.Which order should he should propose to use for pairwise voting to ensure his desired outcome?

Scenario 22-4 Suppose that residents of a town are asked to vote on the best way to improve the safety of an intersection. The three choices are: a stoplight, a 4-way stop, and a 2-way stop. The voters are divided into three groups based on their preferences. Voter Type -Refer to Scenario 22-4.If the vote were conducted according to a Borda count system where each person's first choice receives 3 points,second choice 2 points,and third choice 1 point,the result would be

Moral hazard and adverse selection are similar asymmetric information problems but moral hazard involves hidden actions while adverse selection involves hidden characteristics.

Which of the following is an example of signaling?

An example of screening is a company spending a large sum on advertising to convey the high quality of its product.

Economic policy that appears to be ideal in an economics textbook may not be the final policy that is approved by elected politicians because

Table 22-14 The Johnson family is planning a vacation and, though Mr. and Mrs. Johnson will be paying for the trip, they have decided to use a democratic voting process to choose their destination. The family members' preferences are reflected in the table below. -Refer to Table 22-14.Suppose that before the family can arrive at their decision,Opryland announced that it will be closed for the season due to flooding.If the family uses a Borda count,their vacation destination will be

Effective signals

Conventional economic theory assumes that people

Suppose that there are 175 voters in an election and that 80 of them prefer a $100 budget while the remainder prefer a $150 budget.Which of the following statements is true?

Table 22-2 Three longtime friends-Jack, Ryan, and Colin-are deciding how they will spend their Sunday afternoon. They all agree that they should do one of three things: go to a movie, go to the zoo, or go to a museum. They also agree that they will have two pairwise votes to determine how to spend their evening, with the majority determining the outcome on each vote. The first, second, and third choices for each person are as indicated in the table below. -Refer to Table 22-2.If Jack,Ryan,and Colin use a Borda count,rather than pairwise majority voting,to decide how to spend their afternoon,then they will go to

Which of the following would violate transitivity?

Scenario 22-5 Three members of the DiCarlo family, Vinny, Maria, and Franki, are choosing the entree for a large family reunion. Their options are: spaghetti, ravioli, lasagne, and pizza. Vinny prefers spaghetti over lasagne, lasagne over ravioli, and ravioli over pizza. Maria prefers ravioli over spaghetti, spaghetti over pizza, and pizza over lasagne. Frankie prefers pizza over ravioli, ravioli over lasagne, and lasagne over spaghetti. -Refer to Scenario 22-5.If,before any votes were cast,ravioli was eliminated from the choices,the median voter's first choice would be

Arrow's impossibility theorem illustrates the difficulties in creating the perfect voting system.

Scenario 22-1 At issue in a particular city vote is how much to spend, per person, on road repair next year. Among the 10,000 voters, 1,500 prefer to spend $300 per person, but no more; 2,800 prefer to spend $450 per person, but no more; 3,500 prefer to spend $800 per person, but no more; and 2,200 prefer to spend $1500 per person, but no more. -Refer to Scenario 22-1.If there is a vote on whether to spend $600 per person or $800 per person,the median voter will vote to spend

Eli and Peyton are playing the ultimatum game,starting with $100.The coin flip results in Eli being the one to propose a division of the $100.If Eli acts as economic theory assumes,he should propose that

Scenario 22-5 Three members of the DiCarlo family, Vinny, Maria, and Franki, are choosing the entree for a large family reunion. Their options are: spaghetti, ravioli, lasagne, and pizza. Vinny prefers spaghetti over lasagne, lasagne over ravioli, and ravioli over pizza. Maria prefers ravioli over spaghetti, spaghetti over pizza, and pizza over lasagne. Frankie prefers pizza over ravioli, ravioli over lasagne, and lasagne over spaghetti. -Refer to Scenario 22-5.Maria recommends using a vote by majority rule and proposes first choosing between spaghetti and lasagne,then choosing between the winner of the first vote and ravioli,and finally choosing between the winner of the second vote and pizza.If everyone votes according to his or her preferences,

Table 22-12 The following table shows the number of voters preferring various amounts of spending on a new school. -Refer to Table 22-12.Suppose the voters are asked to choose between $0.5 and $2.0.If all voters cast a vote for the spending amount closest to their own preference,how many votes will the $0.5 spending amount receive?