Insurance companies typically charge women lower prices than men for automobile insurance. Is this an example of price discrimination?
A) Yes, because insurance companies can prevent arbitrage; that is, women cannot transfer their insurance coverage to men.
B) No, because there are too many insurance companies for any one company to have market power. A firm must possess market power in order to practice price discrimination.
C) No, because, on average, women have better driving records than men and the costs of insuring men are greater than the costs of insuring women.
D) Yes, because the costs of selling insurance to men and women are the same.
C
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The United States is the largest national economy in the world.
Answer the following statement true (T) or false (F)
Refer to the scenario above. What is the present value of Option B?
A) $2,463.66 B) $3,267.99 C) $4,157.46 D) $5,800.79
If a trader thinks that the value of yen with respect to the euro is about to fall, which of the following would enable him to make a profit?
A) buy a forward contract for euros B) buy a forward contract for yen C) sell yen in the spot market D) buy euros in the spot market
A rational person:
A. makes choices based on added benefits and added costs. B. considers the financial benefits and financial costs of making a choice. C. undertakes activities until the net benefits become less than zero. D. makes choices based on total benefits and total costs.