How does the market for insurance promote economy growth and investment?
Please provide the best answer for the statement.
Insurance transfers risk from those with low risk tolerance to those with a higher level. When there is a market for insurance those who dislike risk are able to purchase insurance to eliminate a portion of the uncertainty. This allows those with a low tolerance for risk to make investments in the construction and purchase of capital goods like houses and cars, while avoiding some of the risk of fire, theft, and other damages.
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Using the above table, moving from alternative C to alternative B, what is the opportunity cost of one loaf of bread?
A) 1 pizza pie B) 30 pizza pies C) 2 pizza pies D) 0.5 pizza pie
Suppose a firm has an annual budget of $200,000 in wages and salaries, $75,000 in materials, $30,000 in new equipment, $20,000 in rented property, and $35,000 in interest costs on capital. The owner/manager does not choose to pay himself, but he could receive income of $90,000 by working elsewhere. The firm earns revenues of $360,000 per year. What are the annual implicit costs for the firm described above?
A. $160,000. B. $360,000. C. $90,000. D. $450,000.
A government sometimes creates an excess supply of a product by setting a minimum price at which the product may be sold to consumers. This is sometimes called a:
A. price ceiling. B. price floor. C. tax. D. subsidy.
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. The best point for society would be
A. either Point B or Point C, as the total amount being produced at either of these points is approximately the same. B. at any of the labeled points, as all of the points represent an efficient allocation of resources. C. Point C, as at this point there are approximately equal amounts of LCD and OLED televisions being produced. D. indeterminate from this information, as we don't have any information about the society's desires.