Changes in autonomous consumption could be the result of:
A. changes in inflation.
B. changes in housing prices.
C. changes in the mpc.
D. changes in disposable income.
Answer: B
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Answer the following statement(s) true (T) or false (F)
1. Of two baskets with identical standard deviations, a risk-averse person will prefer the basket with the higher expected value. 2. A stock that is guaranteed to increase in value is risk-free. 3. By definition, a risk preferring person will gamble no matter what the odds. 4. A risk neutral person earning $30,000 per year would likely be willing to pay a year's worth of income for a 50-50 chance at winning $70,000. 5. A risk neutral individual has indifference curves that are identical to the iso-expected lines of a fair gamble.
Use the following graph showing the demand and marginal revenue curves faced by a pure monopoly to answer the next question.
If the pure monopoly wants to sell quantity Q1, it should charge
A. P1. B. P2. C. 0. D. a price not labeled on the graph.
Refer to Figure 4-3. If the market price is $2.50, what is the consumer surplus on the first ice cream cone?
A) $0.50 B) $1.00 C) $3.50 D) $9.00
According to the law of demand, quantity demanded decreases as ________, ceteris paribus.
A. prices fall B. demand decreases C. demand increases D. prices rise