« previous next »

Author Question: If a person is risk averse, then she has negative marginal utility of wealth. Indicate whether ... (Read 85 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?

The average adult has about 21 square feet of skin.

Did you know?

It is believed that humans initially contracted crabs from gorillas about 3 million years ago from either sleeping in gorilla nests or eating the apes.

Did you know?

Russia has the highest death rate from cardiovascular disease followed by the Ukraine, Romania, Hungary, and Poland.

Did you know?

To prove that stomach ulcers were caused by bacteria and not by stress, a researcher consumed an entire laboratory beaker full of bacterial culture. After this, he did indeed develop stomach ulcers, and won the Nobel Prize for his discovery.

Did you know?

Recent studies have shown that the number of medication errors increases in relation to the number of orders that are verified per pharmacist, per work shift.

These species are all at risk of extinction. These species are all at risk of extinction.
A well-folded letter fits easily into the envelope and is easily removed by the person who receives ... A well-folded letter fits easily into the envelope and is easily removed by the person who receives ...
Gram negative N. gonorrhoeae. Gram negative N. gonorrhoeae.
Pelvis and knee rock. Hold the feet again for a moment, and move to the person’s right side. Place ... Pelvis and knee rock. Hold the feet again for a moment, and move to the person’s right side. Place ...
Brushing off to finish-front. Move to the front and place the person’s hands on his or her knees. ... Brushing off to finish-front. Move to the front and place the person’s hands on his or her knees. ...
Negative and positive feedback loops Negative and positive feedback loops
Video: Reflex arc construction

For a complete list of videos, visit our video library