How do participants in an auction respond to the problem of the "winner's curse"?
a. They bid more aggressively to win the auction and avoid the "curse".
b. They exit the auction because winning can only be a bad sign of the object's worth.
c. All bid less aggressively, so that the winner ends up not regretting having won.
d. The winner regrets having won the auction.
c
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Everything else held constant, if aggregate output is to the ________ of the LM curve, then there is an excess ________ of money which will cause the interest rate to fall
A) right; supply B) right; demand C) left; supply D) left; demand
Suppose Mo is considering whether to see Zombie Revenge III at her local movie theater. Tickets cost $12 each, but Mo isn't sure how much she's going to like the movie. There's a 40 percent chance she'll get $20 worth of enjoyment from seeing the movie, and there's a 60 percent chance she'll only get $10 worth of enjoyment from seeing the movie. Mo's expected value of seeing the movie is:
A. $2. B. $20. C. $4. D. $14.
In the above table, the average propensity to save when disposable income is $5,000 is
A. 0.2. B. 0.0. C. -0.1. D. 0.1.
What makes the U.S. dollar exchange rate fluctuate?
What will be an ideal response?