Making many risky bets
A) reduces your expected value.
B) is called risk-pooling and can reduce risk.
C) is irrational.
D) is called risk pooling and increases your expected value.
B
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In perfect competition, each individual firm faces ________ demand curve
A) an inelastic B) an upward sloping C) a perfectly elastic D) a downward sloping
The "Big Mac Theory of Exchange Rates" tests the accuracy of the purchasing power parity theory. In July 2015, the Economist reported that the average price of a Big Mac in the U.S. was $4.79
In Sweden, the average price of a Big Mac at that time was 43.7 kronor. What is the "implied exchange rate" between Swedish kronor and U.S. dollars? A) 0.11 kronor per dollar B) 1.90 kronor per dollar C) 9.12 kronor per dollar D) 46.2 kronor per dollar
The natural rate of interest is the rate
A) which equates saving and investment under any employment condition. B) which equates saving and investment with acceptable, but low, unemployment. C) which equates saving and investment at an unemployment rate of 5 percent or less. D) which equates saving and investment at full employment.
In the above figure, the break-even output and price is
A) $9 and 14. B) $13 and 14. C) $11 and 16. D) $10 and 17.