« previous next »

Author Question: If a person is risk averse, then she has negative marginal utility of wealth. Indicate whether ... (Read 92 times)

tichca

  • Hero Member
  • *****
  • Posts: 554
on: Jul 1, 2018
If a person is risk averse, then she has negative marginal utility of wealth.
 
  Indicate whether the statement is true or false

Question 2

Risk premium is the ________ amount that a ________ person would pay to avoid ________.
 
  A) maximum; risk-averse; taking a risk
  B) maximum; risk-neutral; losing everything
  C) minimum; risk-averse; taking a risk
  D) minimum; risk-loving; losing everything
Microeconomics ¦ Perloff ¦ 8th Edition
Buy Test-Bank


Sassygurl126

  • Sr. Member
  • ****
  • Posts: 320
Reply #1 on: Jul 1, 2018
Answer to Question 1

False. The marginal utility of wealth is positive for the risk-averse person; however, marginal utility diminishes as wealth increases.

Answer to Question 2

A


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Signs and symptoms that may signify an eye tumor include general blurred vision, bulging eye(s), double vision, a sensation of a foreign body in the eye(s), iris defects, limited ability to move the eyelid(s), limited ability to move the eye(s), pain or discomfort in or around the eyes or eyelids, red or pink eyes, white or cloud spots on the eye(s), colored spots on the eyelid(s), swelling around the eyes, swollen eyelid(s), and general vision loss.

Did you know?

Though methadone is often used to treat dependency on other opioids, the drug itself can be abused. Crushing or snorting methadone can achieve the opiate "rush" desired by addicts. Improper use such as these can lead to a dangerous dependency on methadone. This drug now accounts for nearly one-third of opioid-related deaths.

Did you know?

Most strokes are caused when blood clots move to a blood vessel in the brain and block blood flow to that area. Thrombolytic therapy can be used to dissolve the clot quickly. If given within 3 hours of the first stroke symptoms, this therapy can help limit stroke damage and disability.

Did you know?

Famous people who died from poisoning or drug overdose include, Adolf Hitler, Socrates, Juan Ponce de Leon, Marilyn Monroe, Judy Garland, and John Belushi.

Did you know?

Every 10 seconds, a person in the United States goes to the emergency room complaining of head pain. About 1.2 million visits are for acute migraine attacks.

Water potentials decrease (become more negative) as one moves from soil to plant to atmosphere Water potentials decrease (become more negative) as one moves from soil to plant to atmosphere
negative feedback negative feedback
Serotonin and Risk-Taking Behavior Serotonin and Risk-Taking Behavior
Positive and Negative Symptoms of Schizophrenia Positive and Negative Symptoms of Schizophrenia
Nonverbal communications convey strong, powerful messages that may be negative or positive. Nonverbal communications convey strong, powerful messages that may be negative or positive.
The Power and Control Wheels of Abusive Relationships When one person in a relationship repeatedly ... The Power and Control Wheels of Abusive Relationships When one person in a relationship repeatedly ...
Video: What are Strong & Weak Acids and How they're different?

For a complete list of videos, visit our video library