Persons whose utility functions are concave with respect to wealth are said to be
A. risk-seekers.
B. risk-averse.
C. risk-neutral.
D. fair gamblers.
Answer: B
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Consider a market that is in equilibrium. If it experiences both an increase in demand and an increase in supply, what can be said of the new equilibrium? The equilibrium:
A. price and quantity will both rise. B. quantity will definitely rise, while the equilibrium price cannot be predicted. C. price will definitely rise, while the equilibrium quantity cannot be predicted. D. price and quantity will both fall.
Compared to the perfectly competitive outcome, monopolistically competitive markets will result in:
a. a wider variety of products and higher prices. b. less product variety and higher prices. c. a wider variety of products and lower prices. d. less product variety and lower prices.
From 1929 to 1932, the total value of the stock market:
A. stayed the same. B. more than tripled. C. more than quadrupled. D. decreased by nearly 90 percent.
If a monopolistically competitive firm's demand curve is shifting left, it will stop shifting only when:
A. the firm raises its price. B. firms stop leaving the industry. C. the firm lowers its price. D. firms stop entering the industry.