What would best explain why a generally risk-averse person would bet $100 during a night of blackjack in Las Vegas?
A) Risk aversion relates to income choices only, not expenditure choices.
B) Risk averse people may gamble under some circumstances.
C) The economics of gambling and the economics of income risk are two different things.
D) Risk-averse people attach high subjective probabilities to favorable outcomes, even when objective probabilities are known.
B
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What is meant by the term "marginal change"?
What will be an ideal response?
Suppose the official gold value of the Brazilian real changes from 527 reals per ounce to 508 reals per ounce. We can then say that:
a. the Brazilian real has depreciated in value as a consequence of free market fluctuations. b. the Brazilian real has appreciated in value. c. gold is now more expensive to purchase in Brazil than it was before. d. the Brazilian real has been devalued. e. the Brazilian economy is expected to experience rapid inflation.
An increase in the U.S. GDP will result in
A. an increase in exports of the United States. B. an increase in imports of the United States. C. an increase in the dollar exchange rate and a decrease in imports of the United States. D. an increase in the dollar exchange rate and a rise in imports of the United States.
Absolute advantage occurs when one nation can produce a good ____ its trading partners.
A. in larger quantities than B. faster than C. that is desired by D. more efficiently than