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calculate how much one would be willing to spend to take away the risk, yet I always get different answers depending on how I do it.
what's the maximum probability of that last last thing happening that will induce the person to vote for action.
What role does economics play in our personal decisions. What role does economics play in the organizational decisions. How does the availability of substitutes affect purchasing decisions.
Why is the marginal cost of inputs more important than the average cost of inputs.
Who will buy which policy. Will the insurance company make a profit, break even or lose money.
why would you select that choice and what utility do you receive. What utility are you looking for id and when you use commercial aircraft for longer distances.
have no more money to spend. How might I have reallocated my spending so as to maximize my total satisfaction from pizza and coffee.
Discuss how, why (and whether) consumer demand for gasoline changes when the price of gasoline falls. As part of your answer, indicate what role the theory of diminishing marginal utility plays. &
If the worker has a weekly income of $600 and has 70 hours a week of Leisure, how many additional dollars of income would it take to make the worker work 10 more hours a week.
You go to an auction and set a maximum price of $100 you are willing to bid on an item. However, you are fortunate and purchase it for $50. Does the lower price alter the marginal utility you origin
Al enjoys watching old episodes of the sitcom Friends. He claims that old episodes are always funny, but he does admit that the more he sees an episode, the less funny it gets.
Newspaper vending machines are designed so that once you have paid for one paper; you could take more than one paper at a time. But soda vending machines, once you have paid for one soda, dispense
For each of the following situations, decide whether the bundle Lakshani is thinking about consuming is optimal or not. If it is not optimal, how could Lakshani improve her overall level of utility.
What effort does the principal want to induce when effort is not observable. What is the optimal contract for the principal.
Is this rate of trade-off the same no matter how many apples are relinquished. Write down the algebraic equation for this person's budget constraint, and graph it showing the points mentioned in par
Given that the individual faces the prospect of gaining or losing an amount of wealth h with equal probability, determine the maximum insurance premium that the individual is prepared to pay. &nbs
calculate utility function that corresponds to a constant Arrow-Pratt measure of absolute risk-aversion. Here's a problem from Mas-Colell, Whinston and Green textbook on Microeconomic.
Is she buying the utility-maximizing combination of bread and milk. If not, how should she reallocate her expenditures between the two goods.
Which nation is likely to receive the most benefit from this increase in investment. Explain your answer.
Given the difficulties that the regulation of public utilities faces, would it not be better to nationalize public utilities, as some European countries have done. Explain."
Solve for the optimal choice. Graph this solution. How many hours of work is the consumer working. What is her income. Can you show me the steps needed to solve the this problem.
What is expected utility theory. On what assumptions is the theory based, and how plausible are these assumptions. Explain the Ellsberg paradox.
What does the agent choose if the terms are worse than actuarially fair. Show there are either one or two kinds of equilibrium in competitive insurance markets, depending on how equilibrium is defin
Determine the equilibrium outcome, or outcomes, when there are more sellers than buyers. What are the characteristics of the "market for lemons.
While effort is not observable, profits are. The firm is risk neutral and so maximizes expected profits net of wages. What would happen if there were full information.