Suppose You and a Friend Are Shopping at a Swap

question 88

Multiple Choice

Suppose you and a friend are shopping at a swap meet and you borrow $500 from your friend to pay for a guitar that you see there. This is an example of

• A) direct financing.
• B) indirect financing.
• C) moral hazard.
• D) transaction costs.

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Definitions:

Minimax Strategy

In relating to others, we try to minimise the costs and maximise the rewards that accrue.

Maternal Deprivation

A theory that suggests the lack of an attachment figure, especially a mother, during childhood, can lead to long-term cognitive, social, and emotional difficulties.

Spitz

The name of a psychologist, René Spitz, known for his research on the effects of deprivation of emotional nurturance on infants.

Social Deficiencies

Lacks or shortcomings in one's ability to perform in social settings or maintain successful social relationships.