John's utility of wealth curve is shown in the above figure. He currently has wealth of $20,000, and there is a 25 percent chance that he could lose it all. If an insurance company offers to insure against this loss for $6,000, John will
A) buy the policy.
B) not buy the policy.
C) be indifferent between being insured and uninsured.
D) There is not enough information to answer.
A
Economics
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Gilda's Art Gallery rewards its employees with stock each year the gallery makes profits. This stock allows the employees to own part of the gallery. This practice is known as
A) the principle-agent problem. B) incentive pay. C) minimizing implicit costs. D) minimizing explicit costs.
Economics
For each interest rate, the LM curve illustrates the level of output where
A) the goods market is in equilibrium. B) inventory investment equals zero. C) money supply equals money demand. D) all of the above E) none of the above
Economics