In general, people are willing to pay more than the expected value of insurance because:
A. they are risk-averse.
B. most people would have trouble finding enough money to cover their losses.
C. it allows them to afford major expenses from catastrophes without going bankrupt.
D. All of these statements are true.
D. All of these statements are true.
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If a $10 sales tax is imposed on a good and the equilibrium price increases by $10, the tax is
A) split between buyers and sellers but not evenly. B) paid fully by sellers. C) paid fully by buyers. D) split evenly between buyers and sellers. E) perhaps split between buyers and sellers but it is impossible to determine the incidence without further information.
Fiscal policy tries to influence target variables by manipulating
A) money supply. B) interest rates. C) government expenditures. D) All of the above.
Under monopsony, marginal factor cost is
A) equal to the wage rate. B) below the wage rate but increases as more workers are hired. C) greater than the wage rate. D) downward sloping.
The domestic currency value of the foreign currency price of a product is equal to: a. the reciprocal exchange rate between the domestic and foreign currency. b. the reciprocal of the foreign currency price of the product
c. the difference between the foreign currency price of the product and the exchange rate between the domestic and foreign currency. d. the foreign currency price of the product multiplied by the exchange rate between the domestic and foreign currency. e. the reciprocal exchange rate between the domestic and foreign currency divided by the foreign currency price of the product.