Академический Документы
Профессиональный Документы
Культура Документы
Question 1
5 out of 5 points
If the prices of all goods increase by the same proportion as income, the quantity demanded of good X will
Answer Selected Answer:
remain unchanged.
Correct Answer:
remain unchanged.
y
Question 2
0 out of 5 points
With only two goods, if the income effect is in the opposite direction as the substitution effect but the income effect dominates then the good is
Answer Selected Answer:
Giffen
y
Question 3
5 out of 5 points
A change in the distribution of income which leaves total income constant will not shift the market demand curve for a product providing
Answer Selected Answer:
Question 4
0 out of 5 points
Which of the following functional forms for utility suggests the greatest substitution effect when starting at the point where PX = PY
Answer Selected Answer:
U = min (X, Y)
Correct Answer:
U=X+Y
y
Question 5
0 out of 5 points
Question 6
0 out of 5 points
In Homogenia everyone is the same. Demand for apples is P = A - Bq for each of its 1 million citizens. Market demand for apples in Homogenia is given by the equation
Answer Selected Answer:
Correct Answer:
Question 7
0 out of 5 points
Suppose there are two people who demand apples. Suppose one considers apples and oranges complements and another considers them substitutes. An increase in the price of oranges will
Answer Selected Answer:
Question 8
5 out of 5 points
Suppose you were to believe that money illusion exists that is as prices and incomes both rise proportionally, people buy more. Which of the following characteristics of demand does that cause you to doubt?
Answer Selected Answer:
Question 9
0 out of 5 points
If there are only two goods and these are consumed in fixed proportions, the price elasticities of demand for these two goods will sum to
Answer Selected Answer:
0.0
Correct Answer:
-1.0
y
Question 10
5 out of 5 points
Question 11
0 out of 5 points
Question 12
5 out of 5 points
If a fair gamble is played many times, the combined monetary losses or gains will
Answer Selected Answer:
approach zero.
Correct Answer:
approach zero.
y
Question 13
0 out of 5 points
Risk averse individuals will diversify their investments because this will
Answer Selected Answer:
Question 14
5 out of 5 points
Suppose a lottery ticket costs $1and has a jackpot of $1 million. What must the probability of winning nothing be if the bet is fair?
Answer Selected Answer:
99.9999%
Correct Answer:
99.9999%
y
Question 15
5 out of 5 points
Suppose a lottery ticket costs $1 and the probability that a holder will win nothing is 90%. What must the jackpot be for this to be a fair bet?
Answer Selected Answer:
10
Correct Answer:
10
y
Question 16
5 out of 5 points
Suppose a lottery ticket costs $1 and the probability that a holder will win nothing is 99%. What must the jackpot be for this to be a fair bet?
Answer Selected Answer:
100
Correct Answer:
100
y
Question 17
5 out of 5 points
Suppose a lottery ticket costs $1 and the probability that a holder will win nothing is 99.9%. What must the jackpot be for this to be a fair bet?
Answer Selected Answer:
1,000
Correct Answer:
1,000
y
Question 18
5 out of 5 points
A gamble can be described as fair if the expected value of the gamble (including any costs of play) is
Answer Selected Answer:
zero.
Correct Answer:
zero.
y
Question 19
5 out of 5 points
Suppose a risk-neutral power plant needs 10,000 tons of coal for its operations next month. It is uncertain about the future price of coal. Today it sells for $60 a ton but next month it could be $50 or $70 (with equal probability). How much would the power plant be willing to pay today for an option to buy a ton of coal next month at todays price? (Ignore discounting over the short period of a month.)
Answer Selected Answer:
5
Correct Answer:
5
y
Question 20
0 out of 5 points
Suppose a family has saved enough for a 10 day vacation (the only one they will be able to take for 10 years) and has a utility function U = V1/2(where V is the number of healthy vacation days they experience). Suppose they are not a particularly healthy family and the probability that someone will have a vacation-ruining illness (V = 0) is 20%. What is the expected value of V?
Answer Selected Answer:
2
Correct Answer:
8
Friday, December 23, 2011 10:58:55 AM EST