Purchase Solution

adverse selection and moral hazard

Not what you're looking for?

Ask Custom Question

I need an answer to the following question: Is there anything the U.S. government can do today to improve the nation's competitive position in the global economy?

Purchase this Solution

Solution Summary

Examine the effects and implications of adverse selection and moral hazard.

Solution Preview

State is an indispensable instrument of economic development and it take undertake activities that would compensate for the market failure. Market failure is perceived as the inability of markets to allocate optimally resources over time.
The role of the government may include:
A) Determination of the conditions under which individuals or groups would be permitted to enter certain lines of business or avail of public facilities and scarce resources.
B) Regulating the conduct of Industrial or business through legislation such as telecom regulatory authority in India has laid down fair rules for the industry.
C) Regulating the relationship between different segments or interest groups in the economy so as to protect legal rights.
D) By providing an analytical framework for the industries, private sector, externalities such as pollution ...

Purchase this Solution


Free BrainMass Quizzes
Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.