Exam 22: Frontiers in Microeconomics.

Scenario 22-2 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 Scenario 22-2.Consider the public policy for dealing with the diseased trees.Using pairwise majority voting with A versus B,then the winner of that vote versus C,then the winner of that vote versus D,which policy wins?

Informational asymmetry is a difference in

Table 22-16 Citizens in a small town are deciding how best to develop a plot of land at the center of town. They have narrowed the options to: a park, town hall, gas station, restaurant. The voters' preferences are shown in the table below. -Refer to Table 22-16.If the election is conducted by instant runoff,the election winner will be

Which of the following statements is correct?

Table 22-16 Citizens in a small town are deciding how best to develop a plot of land at the center of town. They have narrowed the options to: a park, town hall, gas station, restaurant. The voters' preferences are shown in the table below. -Refer to Table 22-16.If the election is conducted by instant runoff,the first votes to be reassigned will be the first choice votes for

A safe driver would likely choose an auto insurance policy with a

Table 22-13 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 22-13.Which of the following statements is correct regarding the results of pairwise voting in Anytown?

The median-voter theorem explains why

Budweiser typically purchases several 30 second advertising spots during the Super Bowl at a very high cost.Miller Brewing Co.typically does not advertise during the Super Bowl.Which of the following is correct?

"Signaling" refers to actions by an informed party for the sole purpose of

Anthony and Addie are playing the ultimatum game,starting with $100.The coin flip results in Anthony being the one to propose a division of the $100.Anthony proposes that he gets $99 and Addie gets $1.Which of the following statements is correct?

Adverse selection may lead to

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.Which of the following statements is correct?

Margaret knows that she needs to save 20% of her annual income for retirement.However,she spends 90% of her income each year.This is an indication that Margaret's preferences are

Suppose you are covered under health insurance or belong to a Health Maintenance Organization (HMO),and you are insured against all or most of the costs of visits to the doctor.As a result you are likely to make greater use of medical services of all kinds.This tendency of people with insurance to change their behavior in a way that leads to more claims against the insurance company is called

A mother gives her teenage daughter two choices: spend 20 minutes cleaning her room today or spend 25 minutes cleaning her room tomorrow.The same mother gives her same daughter two additional choices: clean out the garage for 20 minutes next Tuesday or 25 minutes next Wednesday.According to economic theory,

Which of the following statements is not correct?

As an alternative to pairwise majority voting,each voter could be asked to rank the possible outcomes,giving 1 point to her lowest choice,2 points to her second-lowest choice,3 points to her third-lowest choice,and so on.This voting method is called a(n)

Table 22-6 -Refer to Table 22-6.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?

Table 22-8 -Refer to Table 22-8.The table shows the preferences of four types of voters over four possible outcomes: A,B,C,D.In addition,the table shows the percentage of voters of each type.Given pairwise voting in which voters choose first between A and B,then between the winner of the first vote and C,and finally between the winner of the second vote and D,which outcome would win?