If a person is risk neutral, then she
A) is indifferent about playing a fair game.
B) will pay a premium to avoid a fair game.
C) has a horizontal utility function.
D) has zero marginal utility of wealth.
A
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The income per capita of two neighboring countries for a particular year were equal. However, Country 1 had a higher income per worker than Country 2. Which of the following is likely to be true?
A) The number of people unemployed is lower in Country 1 than in Country 2. B) The number of children aged below 15 is higher in Country 2 than in Country 1. C) The number of retired people is higher in Country 2 than in Country 1. D) The number of people employed is higher in Country 2 than in Country 1.
If firms' expectations about the future become pessimistic so that they think future profits will be lower, then
A) aggregate demand decreases and the AD curve shifts leftward. B) aggregate demand increases and the AD curve shifts rightward. C) the quantity of real GDP demanded decreases, and there is a movement up along the AD curve. D) the quantity of real GDP demanded increases, and there is a movement down along the AD curve. E) the aggregate demand curve does not shift, but potential GDP decreases.