Econ 256 Final

2. wherefore do economists generally compliments median income as a better measure of a typical Americans well-being than mean income? Dfiodifaje 3. Why do the United States, and m any(prenominal) other counties, have antitrust laws on the books? Whats so harmful about(predicate) oligopoly that warrants an entire body of law? The United States and many other countries have antitrust laws on the books to nourish their consumers in their different markets. Having the abilities to both raise and lower prices are the reasons that oligopolies are so harmful. . Two consumers go to the insurance fraternity to purchase some life insurance. James is a smoker and a jurisprudence officer who races motorcycles in his clean-cut time. Kathy is a nonsmoker and a librarian who likes to make quilts in her spare time. The insurance company knows that both consumers are 40 years old, but the company has no education about occupations or hobbies. How does the private information in this situatio n create an adverse-selection problem? How could the insurance company lessen this problem?Without knowing the background information on the potential clients, insurance companies are without the office to see that while James is essaying his life as a police officer, he is also a smoker and racer. Hes putting his life on the line and still increasing the risk of injuries. The insurance should have a line on their application that asks for applicants for their occupation, whether they are smokers or if they drink, and lastly what they enthral doing in their spare time.With having this information, the company can see what each of the individuals really needs insurance-wise. 6. Jane works odd- art(prenominal) and earns $12,000 per year. Because she is below the poverty line, she also earns $4,000 in various welfare benefits. Suppose she is offered a new job that would pay her $15,000 and would bring her earnings high enough so that she no longer qualified for any welfare benefits . This is what is known as a notch. Explain what is happening with Jane and how could we modify the system to distinguish the notch.