You can either invest in project A or B. Project A could have a value of $100 with a probability of 0.1 or a value of $75 with probability 0.9 . Project B could have a value of $110 with probability 0.2 or a value of $70 with a probability of 0.8 . Which project should you invest in?
a. Project A
b. Project B
c. Neither of the projects
d. You cannot tell from the information presented
b
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In the above figure, if the price of pizza falls, the budget line
A) rotates outward and becomes steeper. B) shifts leftward and its slope does not change. C) shifts rightward and its slope does not change. D) rotates inward and becomes flatter.
Stagflation can be explained by a
a. shift in the short run Phillips curve to the left. b. shift in the short run Phillips curve to the right. c. a movement along the short run Phillips curve to the right. d. a movement along the short run Phillips curve to the left.
When someone is served pizza and soda for dinner, it is typical behavior to eat some pizza, then drink some soda, then eat more pizza, and so on, until the person stops consuming both. How can this behavior be explained using economic concepts?
A. The individual is revealing that he can't decide whether he gains more utility from pizza or from soda. B. People tend to act irrationally around food, and the concept of utility maximization cannot be applied. C. The person eats pizza until his marginal utility for pizza is lower than it is for soda, then he switches to soda. D. The concept of unlimited wants says he will never tire of eating pizza and soda.
Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. The opportunity cost of one tomato in Country A is:
A. 100 bananas. B. 20 bananas. C. 5 bananas. D. 4 bananas.