The above figure shows Bob's utility function. He currently has $100 of wealth, but there is a 50% chance that it could all be stolen. What is the most Bob would pay for insurance that would replace his $100 should it be stolen?
A) $30
B) $50
C) $70
D) $75
C
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Structural unemployment
A) falls during the expansion phase of the business cycle. B) falls as the pace of technological progress increases. C) generally lasts longer than frictional unemployment. D) falls when the government provides more generous unemployment compensation benefits.
How does a decline in the real interest rate cause an increase in investment?
What will be an ideal response?
If the contribution from capital growth equals 2 percent and the contribution from labor growth equals 4 percent, then GDP ________
A) will grow by 6 percent B) will grow by 8 percent C) will grow by 2 percent D) will change by an unknown percentage
Which of the following is true of a firm that can successfully practice price discrimination?
a. Its total revenue is often reduced. b. It appropriates a part of the consumer surplus. c. It has no way of distinguishing between types of customers. d. It has no market power in the industry. e. It must be a perfectly competitive firm.