Refer to Scenario 5.6. If the doctor is risk-averse, she would accept
A) $50,000 for sure rather than take the risk of being a researcher.
B) $60,000 for sure (the minimum HMO outcome) rather than take the risk of being a researcher.
C) $95,000 for sure rather than face option 1 and option 2 in research.
D) $275,000 for sure (the average of option 1 and option 2 in research), but not less, rather than face the risk of those two options.
E) the research position because it has the highest possible income.
C
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In the long run, all firms in a monopolistically competitive industry make
A) negative accounting profit. B) zero accounting profit. C) an economic profit. D) zero economic profit.
The law of diminishing marginal utility may be illustrated by a person
a. buying additional goods after getting a pay raise b. eating more twinkies but enjoying them less c. giving some of income to a needy person d. who spends more hours studying than do his fellow students e. buying goods so long as their marginal utility is greater than zero