The Friedman-Savage utility function can explain why
A) people buy automobile insurance.
B) somebody becomes addicted to gambling.
C) people become more risk averse as their wealth increases.
D) people place small bets to have a chance at winning a large amount.
D
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The above figure shows the market for game day t-shirts. If the price of t-shirts is $10, then
A) there is a surplus and the price of t-shirts will fall. B) there is a shortage and the price of t-shirts will fall. C) there is a shortage and the price of t-shirts will rise. D) there is a surplus and the price of t-shirts will rise. E) the market is in equilibrium.
When two companies that produce the same product merge, it is called a
A) conglomerate merger. B) diagonal merger. C) horizontal merger. D) vertical merger.
Describe how the risk premium for a person with a convex utility function is determined
What will be an ideal response?
Which of the following sets of terms describes the problem of scarcity in economics?
A) goods, land, and needs B) labor, needs, and opportunity costs C) choices, opportunity costs, and trade-offs D) production, consumption, and wants