Increasing the Amount of Information Available to Investors Helps to Reduce

question 61

Multiple Choice

Increasing the amount of information available to investors helps to reduce the problems of ________ and ________ in the financial markets.

• A)adverse selection;moral hazard
• B)adverse selection;risk sharing
• C)moral hazard;transactions costs
• D)adverse selection;economies of scale

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Definitions:

Verbal

Relating to or consisting of words, especially as opposed to actions or visual representations; often pertaining to spoken language or communication.

Mathematical

Pertaining to mathematics; involving the study of numbers, quantities, structures, and their relationships.

Analytic Intelligence

Analytic Intelligence is a component of Sternberg's triarchic theory of intelligence that involves mental processes used in learning how to solve problems, including logical reasoning and critical analysis.

Logical-Mathematical

A cognitive ability or intelligence that involves logical reasoning and the capacity for mathematical problem solving.