Diminishing marginal utility of wealth implies that the utility function
a. has increasing slope and a person is risk averse.
b. has increasing slope and a person is not risk averse.
c. has decreasing slope and a person is risk averse
d. has decreasing slope and a person is not risk averse.
c
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In the simple Keynesian model, if the equilibrium level of income is $300 billion, the MPC is 0.75, and government expenditures increase by 20 billion. What is the new equilibrium level of income?
a. $320 billion b. $380 billion c. $220 billion d. $520 billion
If a technological change occurs such that the production function shifts from q = 10K0.5 L0.5 to q = 10.5K0.3 L0.5, then the technological change is
A) both neutral and non-neutral. B) neutral. C) non-neutral. D) Not enough information given.
It is absolutely necessary for at least one trader to have money for barter exchange to take place
a. True b. False Indicate whether the statement is true or false
During the 2016 Summer Olympics in the city of Rio, some Rio residents rented rooms to visitors. This behavior
A) helped reduce the shortage of hotel rooms caused by the high demand during the Olympics. B) reduced the demand for tickets to the Olympics since many local residents left town while they rented out space in their homes. C) helped raise the prices that visitors paid for hotel rooms in Rio. D) raised the demand for hotel rooms in Rio and should have been prevented by the city of Rio.