Shareholders with diversified portfolios will encourage
a. social decision-makers to be risk-neutral.
b. corporate decision-makers to be risk-neutral.
c. corporate decision-makers to be risk-preferring.
d. individual entrepreneurs to be risk preferring.
b. corporate decision-makers to be risk-neutral.
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Using Figure 6-2, calculate the price elasticity of demand (dropping all minus signs) between P = 4 and P = 6.
A. 3.0 B. 0.33 C. 0.40 D. 1.25
Wealth differs from income in that
A) income measures value at a point in time and wealth measures value over a period of time. B) income measures value over a period of time and wealth measures value at a point in time. C) income is what you own and wealth is what you earn. D) wealth can be measured in dollars and income cannot.
If the average total cost curve is always above the demand curve for a monopolist:
a. the profits of the monopolist will be large. b. the monopolist must be producing inefficiently. c. the monopolist will suffer economic losses. d. entry will occur, forcing the monopolist to reduce price and expand output.
Explain the difference between a "change in quantity supplied" and a "change in supply."
What will be an ideal response?