If Shaniq is a risk averse, then
A) her cost of risk exceeds 0.
B) she has diminishing marginal utility of wealth.
C) she is willing to buy insurance if the cost of insurance is low enough.
D) all of the above.
Question 2
If the elasticity of supply is 4, a 10 percent increase in the price of a good leads to a
A) 40 percent increase in the quantity of supply.
B) 4 percent decrease in the quantity demanded.
C) 2.5 percent increase in the quantity supplied.
D) 2.5 percent decrease in the quantity demanded.
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