The ultimatum game reveals that
a. it does not make sense to try to maximize profits.
b. people may have an innate sense of fairness that economic theory does not capture.
c. offering someone a wildly unfair outcome is usually ok since people tend to make decisions using a "something is better than nothing" philosophy.
d. Both a and b.
b
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One year before maturity the price of a bond with a principal amount of $1,000 and a coupon rate of 5% paid annually fell to $981. The one year interest rate must be
A. 8.5%. B. 7.0%. C. 5.0%. D. 1.9%.
Recent income distribution figures in the United States show
A) slightly more inequality. B) less inequality. C) greater equity. D) less equity.
Many poorer countries face political instability and insecure property rights.
Answer the following statement true (T) or false (F)
Why is there an asymmetric information problem in the market for health care?
A. The patient, not the physician, knows most about the amount and type of health care to be provided B. The government, not the physician, knows most about the amount and type of health care to be provided C. Insurance companies, not the physician, knows most about the type of health care to be provided D. The physician, not the patient, knows most about the amount and type of health care to be provided