Consider a risk-averse individual whose initial situation is a risk-free basket of outcomes. How does this person react when he is offered a wager at favorable odds?
a. He always declines the wager.
b. He always accepts the wager.
c. He accepts the wager only if it is sufficiently small.
d. He accepts the wager only if it is sufficiently large.
c. He accepts the wager only if it is sufficiently small.
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The figure above provides information about Light-U-Up Utilities, which is a natural monopoly that provides electricity. At the unregulated price and quantity, Light-U-Up's economic profit is equal to
A) -$10. B) $10. C) $40. D) $60.
Which of the following best represents the money supply?
A) Money supply = Monetary base. B) Money supply = Monetary base / Money multiplier. C) Money supply = Money multiplier ( Currency in circulation + Reserves). D) Money supply = (Currency in circulation + Reserves) / Money multiplier.