Reinsurance exists to permit
A. people to buy insurance against terrorist acts.
B. insurance companies to absorb predictable losses.
C. insurance companies to absorb large losses.
D. people to buy insurance against accidents.
Answer: C
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If marginal utility of apples is diminishing and is a positive amount, consuming one more apple will cause
A) a consumer to go beyond her optimal consumption of apples. B) total utility to decrease. C) a consumer to get no satisfaction from consuming apples. D) a consumer's total utility to increase.
As long as TVC < TR, a firm will have a positive level of output in the short run
a. True b. False Indicate whether the statement is true or false
The distinguishing feature of the land market is that the
a. supply is highly inelastic. b. supply is highly elastic. c. demand is highly inelastic. d. demand is highly elastic.
If the firm has no fixed costs and variable costs of $2 per unit, what is the value of the firm's monopoly profits when it sets a price that maximizes its monopoly profits?
a. $7 b. $12 c. $15 d. $16