Suppose Chris is offered the following gamble: with probability 0.1 he will win $90, with probability 0.4 he will win $50, and with probability 0.5 he will lose $60. Chris will:
A. accept this gamble if he is either risk neutral or risk-averse.
B. accept this gamble if he is risk-averse, but not if he is risk-neutral.
C. not accept this gamble if he is risk-neutral.
D. accept this gamble if he is risk neutral, but not if he is risk-averse.
Answer: C
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Which of the following is a negative externality connected to attending college?
A) The fact that completion of a college degree acts as a signaling mechanism to employers. B) The fact that other costs, such as books and materials, are incurred in addition to tuition and fees. C) The fact that your college has required that all individuals living in student housing either get or show they have already obtained vaccinations against all communicable diseases. D) The fact that the people in the next room play loud music at hours you want to sleep. E) The fact that you will get benefits from college that you don't currently anticipate.
Graphically, consumer surplus is measured by: a. the area below the demand curve
b. the area below the demand curve, but above the upward-sloping supply curve. c. the area below the demand curve, but above the market price. d. the area below the market demand curve, but above the supply curve.
Production planning without the market mechanism is very efficiently handled by central planners
a. True b. False Indicate whether the statement is true or false
Independent grocery stores are best-advised to
A. provide a level of service, community involvement, and types of goods Walmart does not. B. hire less-qualified people to keep costs down. C. sell exactly the same goods Walmart does. D. "out Walmart" Walmart by lowering prices.