Option A provides $9,000 with probability 50 percent or $11,000 with probability 50 percent. Option B provides $8,000 with probability 50 percent or $12,000 with probability 50 percent. For most people the cost of risk associated with B is
A) less than that associated with A.
B) the same as that associated with A.
C) exactly twice that associated with A.
D) more than twice that associated with A.
D
You might also like to view...
The demand for U.S. produced packaged food products in foreign countries is expected to
A) grow. B) slow down. C) remain constant. D) fluctuate.
Small time deposits are included in
a. M1 but not M2. b. M2 but not M1. c. M1 and M2. d. neither M1 nor M2.
The principal-agent problem in corporations arises from:
A. the view that workers are agents who are not considered to be the principal asset of the corporations for which they work. B. the fact that the principal objective of most corporations is to make profits and not to contribute to charity. C. a perspective that corporations are agents that represent the principal source of power for government and the national economy. D. a conflict of interest between corporate executives who manage the firm and stockholders who own the firm.
An increase in tax revenues ________ government saving and ________ national saving
A) raises, raises B) raises, lowers C) lowers, raises D) lowers, lowers