Suppose the recipient of a kidney transplant has stated that she would prefer 5 years of perfect health to the 10 years she expects to live with her transplant. For this person, each of her remaining 10 years of life has a QALY value of
a. ½.
b. 2
c. 5
d. 10
e. 50.
C
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Water is cheap and diamonds are expensive because water has a ________, and diamonds have a ________
A) low total utility; high total utility B) low marginal utility; high marginal utility C) high marginal utility; low marginal utility D) low marginal utility and a low total utility; high marginal utility and a high total utility
When an economy operates at its long-run potential output level,
a. aggregate demand will exceed aggregate supply in the goods and services market. b. unemployment will decline to an abnormally low rate that cannot be sustained in the long run. c. the actual rate of unemployment will exceed the natural rate of unemployment. d. the natural and actual rates of unemployment will be equal.
When an individual purchases health insurance and knows more about her family medical history than the insurance company, this is an example of adverse selection
a. True b. False Indicate whether the statement is true or false
Assume that an individual consumes two goods, X and Y. The total utility (assumed measurable) of each good is independent of the rate of consumption of other goods. The prices of X and Y are, respectively, $5 and $10. 
Given the above, if the consumer has $110 to spend on X and Y, which combination will the consumer choose?
A. 7X and 7Y B. 8X and 7Y C. 6X and 8Y D. 7X and 6Y E. 5X and 4Y