The example of the VCRs from Korea illustrates dumping due to

Johnny owns a house that would cost $100,000 to replace should it ever be destroyed by fire. There is a 0.1% chance that the house could be destroyed during the course of a year. Johnny's utility function is U = W0.5

How much would fair insurance cost that completely replaces the house if destroyed by fire? Assuming that Johnny has no other wealth, how much would Johnny be willing to pay for such an insurance policy? Why the difference?

Following an unexpected decline in aggregate demand, once production cutbacks start offsetting rising inventory levels:

a. the aggregate demand curve will shift to the right. b. the aggregate supply curve will shift to the left. c. the economy will return to its natural rate of unemployment. d. the short-run Phillips curve will shift to the right. e. the economy will face both higher inflation and a higher unemployment rate.