A risk-neutral individual is offered a gamble that promises a gain of $1000 with probability 0.25 and a loss of $300 with probability 0.75 . Given this situation, he or she will:
a. definitely take the gamble
b. definitely not take the gamble.
c. definitely take the gamble if his or her income is high enough.
d. take an action that cannot be determined given the information available.
a
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If a nation is currently operating at a point inside its production possibilities curve, it
A. is fully employing all of its resources. B. is operating beyond its possible capacity. C. is utilizing its resources efficiently. D. none of the choices are true.
One of the major functions of financial markets is to help people reduce risk. Describe two financial methods people can use to reduce their exposure to risk
What will be an ideal response?
According to Adam Smith, a well-governed society's wealth is positively related to
A) the division of demand. B) the division of labor. C) the degree to which society can eliminate scarcity. D) the degree to which society can encourage and promote greed.
If an industry has 16 firms of equal size, and each produces and sells the same quantity of output at the same price, what is the four-firm concentration ratio of this industry?
a. 16 percent b. 18 percent c. 22 percent d. 25 percent e. not enough information to determine