Marylou, whose utility of wealth curve is shown in the figure above, faces two options. Option A yields $200 for sure. Option B has a 0.3 probability of yielding $100, and a 0.7 probability of yielding $300. Marylou, who is
A) picks option A.
B) picks option B.
C) is indifferent between option A and option B.
D) needs more information to make a choice.
B
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Assume that the central bank increases the reserve requirement. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to real GDP and the nominal value of the domestic currency in the context of the Three-Sector-Model?
a. Real GDP rises, and nominal value of the domestic currency falls. b. Real GDP falls, and nominal value of the domestic currency rises. c. Real GDP rises, and nominal value of the domestic currency remains the same. d. Real GDP rises, and nominal value of the domestic currency rises. e. There is not enough information to determine what happens to these two macroeconomic variables.
Recall the Application about the mismatch of rent-controlled apartments and their tenants to answer the following question(s).Recall the Application. According to a recent study, about ________ percent of rent-controlled apartments in New York City are mismatched.
A. 20 B. 40 C. 60 D. 80
Full employment does NOT necessarily mean that every adult has a job because
A. students and homemakers are always looking for work. B. policy makers never want to achieve full employment. C. there are always some discouraged workers. D. there are transaction costs in finding a job in the labor market.
In game theory, actions such as cheating that focus solely on short-run gains are referred to as
A) territorial behavior. B) tit-for-tat strategic behavior. C) predatory behavior. D) opportunistic behavior.