Risk-averse persons sometimes prefer to play some gambles even if they know that those gambles are not fair, i.e., on average people lose by playing them. One plausible explanation for this seemingly paradoxical phenomenon is that:
A. Gambling has entertaining effects which are not treated explicitly as part of the payoffs.
B. People's actions are not reasonable.
C. The economic theory of uncertainty is not correct.
D. None of the statements is correct.
Answer: A
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Cost-push inflation is due to:
a. "too much money chasing too few goods". b. the economy operating at full employment. c. increases in production costs. d. all of these.
A recession abroad would cause U.S. net exports to rise
a. True b. False Indicate whether the statement is true or false
Consumer surplus is the
a. amount of a good consumers get without paying anything. b. amount a consumer pays minus the amount the consumer is willing to pay. c. amount a consumer is willing to pay minus the amount the consumer actually pays. d. value of a good to a consumer.
Elasticity of investment measures the responsiveness of
A) interest rates to changes in investment. B) investment to changes in government spending. C) investment to changes in the interest rate. D) investment to changes in consumption.