If a person is risk averse, then she has negative marginal utility of wealth
Indicate whether the statement is true or false
False. The marginal utility of wealth is positive for the risk-averse person; however, marginal utility diminishes as wealth increases.
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The liquidity approach to measuring the money supply uses
A) near moneys only. B) M1 only. C) M2 plus some highly liquid assets. D) M1 plus some highly liquid assets.
Which of the following statements is true?
A) Most of the leading exporting countries are large, high-income countries. B) All sectors of the U.S. economy are affected equally by international trade. C) Each year China exports about 50 percent of its wheat crop and 40 percent of its rice crop. D) Exports benefit trading countries because exports create jobs. Imports do not benefit trading countries because they result in a loss of jobs.
When a person throws a cigarette out of a car window and starts a brush fire, this is
A) an example of an external benefit. B) an example of an external cost. C) an example of a public good. D) an example of market power.
Domestic firms operating abroad may find it economically beneficial to adopt environment-friendly standards because
A) foreign nations may be upset if firms do not use the environment-friendly technology. B) the least-cost strategy usually involves the adoption of one set of environment-friendly technology rather than multiple standards. C) they may be forced to replace the old technology whenever the foreign country experiences positive economic development. D) their environment-unfriendly technology may be replaced by foreign-based technology.