A fair coin is flipped. If it lands heads the person receives $1.00. If it lands tails, the person receives $11.00. If the person is willing to pay $6.00 to take this gamble, they must be
a. risk-averse.
b. risk-neutral.
c. risk-preferring.
d. either risk-neutral or risk-preferring (not risk-averse).
d. either risk-neutral or risk-preferring (not risk-averse).
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The reversal of fortune can be primarily attributed to:
A) the religious practices in a nation. B) the type of institutions in a nation. C) geography of a nations. D) the type of culture in a nation.
"Consumer sovereignty" refers to the:
A. fact that resource prices are higher than product prices in capitalistic economies. B. idea that the pursuit of self-interest is in the public interest. C. idea that the decisions of producers must ultimately conform to consumer demands. D. fact that a federal agency exists to protect consumers from harmful and defective products.
What is the relationship between accounting and economic profits?
A. Economic profits are always negative. B. Accounting profits are always larger than economic profits. C. There is no relationship between economic and accounting profits. D. Economic profits are always larger than accounting profits.
Unlike a monopolistically competitive firm's product, a monopolistic firm's product
A. has many close substitutes. B. is homogeneous. C. has no close substitutes. D. has a vertical demand curve.