A risk-loving individual would:
A. prefer a risky prospect with an expected value of $5 to a certain amount of $5.
B. prefer $5 with certainty to a risky prospect with the expected value of $5.
C. be indifferent between a risky prospect with an expect value of $5 and a certain amount of $5.
D. prefer a risky prospect with the expected value of $0.50 to $5 with certainty.
Answer: A
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Which of the following is recorded in the U.S. balance of payments account?
I. foreign investment in the United States II. U.S. investment abroad III. the U.S. government deficit or surplus A) III only B) I and II C) I and III D) I, II and III
A single-price monopolist
A) sets its price where its demand is inelastic. B) can always increase its profits by increasing its price. C) has its marginal revenue less than its price. D) is guaranteed an economic profit.
According to Friedman's permanent income hypothesis, which of the following statements about transitory income is true?
a. It reflects the unexpected gains of income are transitory income. b. It reflects the income of people who have temporary employment. c. People's consumption depends on transitory income. d. It reflects the income of retired people. e. Habitual losses (or gains) at gambling are transitory income.
Which one of the following is not part of the U.S. money supply?
A. Dollar bills B. Demand deposits C. Travelers checks D. Gold