MHI 582: Module 7 Quiz

Module 7 Quiz

When externalities benefit others, they are called external benefits. When they harm others, they are called external costs.

true

In a perfectly competitive market, every producer has some market power, so producers will set prices to make marginal revenue equal marginal cost.

false

If an externality affects many people or is caused by many people , the cost of reaching and enforcing an agreement will be high.

true

By distorting consumers’ incentives, insurance reduces the likelihood that healthcare markets will function ideally.

true

Regulatory barriers to competition are often better than other competitive advantages because they are often harder for competitors to breach.

true

Capture occurs wen a group loses control of the administration of regulations.

false

Confirmation bias occurs when some initial estimate, even if it is not based on evidence or is imply wrong, affects future discussion.

false

Representativeness bias is the tendency to think that our experience with a small number of people will be typical of the whole group.

true

Most people worry more about avoiding losses than they do about realizing gains.

true

Too many choices can stop consumers from making any choice. This problem is called status quo bias.

false