8. For each of the following situations, determine whether adverse selection, moral hazard, or the principal-agent problem

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8. For each of the following situations, determine whether adverse selection, moral hazard, or the principal-agent problem is at work.

a. You decide to buy a scalped ticket before a concert, but you are not entirely sure the ticket is legitimate.

b. A contractor takes a long time to fi nish the construction work he promised after you gave him his fi nal payment.

c. You hire a neighborhood teenager to mow your grass once a week over the summer while you are traveling. The teenager mows your grass every three weeks instead.

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Principles Of Microeconomics

ISBN: 9780393935769

1st Edition

Authors: Dirk Mateer, Lee Coppock

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