A corporation's market capitalization is best described as
A) the total value of its stocks and bonds.
B) the total value of its common and preferred stock.
C) its total profit for a particular year.
D) its average profit over a period of years.
B
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The above figure shows Bob's utility function. He currently has $50 and is considering investing all of it in an investment that has a 50% chance of being worth $100 and a 50% chance of being worth $0. Bob will
A) definitely make the investment because the expected utility of the investment exceeds the utility of his $50. B) definitely not make the investment because the expected utility of the investment is less than the utility of his $50. C) definitely make the investment because he is indifferent between having $50 and having an investment with an expected value of $50. D) definitely not make the investment because he is indifferent between having $50 and having an investment with an expected value of $50.
A Giffen good has
A) a positive substitution effect. B) a negative income effect. C) a larger income effect than substitution effect. D) All of the above.