________ Occurs When One Party Takes Advantage of Having More

question 133

Multiple Choice

________ occurs when one party takes advantage of having more information than another party about the attributes of the good or service they will exchange.

• A)A negative externality
• B)Moral hazard
• C)A transaction cost
• D)Adverse selection

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Definitions:

Business Sector

A segment of the economy that represents the activities of businesses, corporations, and private enterprises that provide goods and services to consumers.

Deng Xiaoping

A Chinese communist leader who initiated significant economic reforms in China from the late 1970s, leading to its market economy transformation.

Civilian Goods

Items produced for use by civilians, rather than for military purposes.

National Defense

The protective measures taken by a nation in order to defend itself against potential aggressors, including military forces and defense strategies.