We can be more confident that standard deviation is a good measure of the risk of an asset (held in isolation) when
A) the number of different possible returns on the asset rises.
B) the probabilities attached to the possible returns on the asset are less equal.
C) the possible returns on the asset are distributed symmetrically around the mean.
D) the asset has a longer maturity.
C
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Which of the following statements concerning income and substitution effects is not true?
a. Income and substitution effects cause the demand curve to slope downward. b. When the price of a good falls, real purchasing power increases and consumers can purchase more of all goods. c. The substitution effect describes the situation in which more of the good whose price has fallen is purchased, and less of all other goods is purchased. d. A price decrease of one good cannot cause the income effect. e. Income and substitution effects are related to diminishing marginal utility and consumer equilibrium.
If national income = $100, autonomous consumption = $75, and the MPC = 0.80, then consumption spending will equal
a. $60 b. $75 c. $80 d. $100 e. $155