Exam 22: Frontiers of Microeconomics

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

A Principles of Microeconomics professor wants to know how much prior knowledge her students have before beginning the class so she gives them a pre-test. This action is an example of

Table 22-18 The following table shows the preferences of four types of voters over four possible alternatives as well as the percentage of the electorate with the given preferences. -Refer to Table 22-18. In a majority vote between alternatives X and Y, what percentage of the votes would X receive?

Mankiw argues that a primary difference between taxing products like gasoline and taxing soda and other sugary drinks is that

A travel agency offers a money-back guarantee for vacationers taking their first cruise in case they do not enjoy the experience. This guarantee is an example of

Which of the following is a characteristic of a corporation but not of a small family-owned business?

Conventional economic theory assumes that people

Table 22-15 Diane, Henry, and Linda are voting for who to promote. They can only promote one candidate. Their preferences are given in the table below. -Refer to Table 22-15. 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,

When asked to give a range for the height of the tallest mountain in North America such that people were 90 percent confident the true number falls within it, most people gave ranges that were

One of the things that employers can do to lessen the moral hazard problem involving their employees is to pay them in advance for their work.

When new professors are hired, their job performance is monitored closely. If they meet their institution's standards, they will eventually receive tenure. After receiving tenure, professors' job performance is less closely monitored, and they become difficult to fire. Tenure thus creates

Riley travels a great deal, and over the past several years he has read dozens of reviews of hotel chains, all of which rave about the clean rooms and great service at Comeon Inns. Last month, Riley checked into a room at a Comeon Inn for the first time, only to find the room filthy and the service lousy. He decided the Comeon Inn chain is inferior to other hotel chains.

A driver knows more than his auto insurer about how cautiously he drives. This is an example of

Table 22-16 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 22-16. Mr. Johnson recommends using a vote by majority rule. If he wants to ensure that his 1st choice becomes the family's winning destination, he should propose

A life insurance company requires new applicants to have a medical exam prior to writing the insurance policy. This requirement is an example of

A firm with a very good product

Table 22-17 Voter Type -Refer to Table 22-17. The table shows the preferences of three types of voters over three possible outcomes: A, B, and C. The table also shows the percentage of voters of each type. Based on this information, which voter type is the median voter?

A person who makes decisions that are "merely good enough" is called a(n)

Table 22-4 The fortunate residents of Anytown have a budget surplus. The mayor decided that it is only fair to have the residents vote on what to do with the surplus. The mayor has narrowed the options down to three possible projects: a playground, a library, or a swimming pool. The voters fall into three categories and have preferences as illustrated in the table. -Refer to Table 22-4. If the mayor decides to use a Borda count rather than pairwise voting,

Table 22-12 The following table shows the preferences for the five voters in a city regarding how to deal with the city's diseased trees. A = do nothing B = follow the expert's advice to remove every tree C = remove every 4th tree now and perhaps more later D = use an untested spraying alternative -Refer to Table 22-12. Consider the public policy for dealing with diseased trees. Based on the preferences in the table, which of the following statements is correct?