When offered a bet at fair odds, a risk-neutral individual
a. accepts the bet if it is sufficiently small.
b. always wagers everything on one outcome or the other.
c. is indifferent about the amount that he bets.
d. chooses a risk-free basket of outcomes.
c. is indifferent about the amount that he bets.
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A market in which the money of one nation is exchanged for the money of another nation is a ________.
A. foreign exchange market B. resource market C. stock market D. bond market
The relatively low rate of inflation coupled with a low unemployment rate that occurred in the 1990s represented a “normal” economic situation.
Answer the following statement true (T) or false (F)
Assuming MPC is 0.90, what effect, if any, would a change in U.S. net exports of minus $20 billion have on the U.S. level of national income?
a. No effect since the goods would be consumed abroad b. National income increases by $200 billion c. National income decreases by $200 billion d. National income increases by $20 billion e. National income decreases by $20 billion
In graph: (a) How much is the tax? (b) How much of this tax is borne by the buyer? (c) How much of this tax is borne by the seller?
