Jessica must choose option A or option B. Option A gives her $10,000 for sure. Option B gives her $5,000 if a fair coin toss shows heads and $15,000 if it shows tails. If Jessica is risk averse her utility of wealth curve becomes
A) flatter as her wealth increases and she will choose option A.
B) flatter as her wealth increases and she will choose option B.
C) steeper as her wealth increases and she will choose option A.
D) steeper as her wealth increases and she will choose option B.
A
You might also like to view...
According to your text, nineteenth century economist Alfred Marshall believed that technical progress is best accomplished by
a. firms of considerable size that have the resources to engage in research and development b. universities where basic research is initiated c. curtailing competition so that firms will not lose money by experimenting in research and development d. the superior inventive force of a multitude of small competitive firms e. the government subsidizing research and development
In the short run, the profit-maximizing monopolistically competitive firm will produce the rate of output at which
A) P = MC. B) MR = MC. C) P = ATC. D) MR = ATC.