Answer:
B
Explanation:
Because wants are unlimited and the resources available to satisfy these wants are limited, economic agents must undergo trade-off
Trade-off is the opportunity cost of taking a particular decision
Opportunity cost of the next best option forgone when one alternative is chosen over other alternatives
According to the law of supply, if wage rate increases the supply of labour would increase. If wage rate increases, the number of hours that labour would want to work would increase. Thus, there is a positive relationship between wage rate and labour supply. The supply curve for labour is positively sloped. Because time is finite, as the number of hours labour works increases, labour would have less time for leisure.
Answer:
Scenario 1: A risk-averse person will choose option B.
Scenario 2: A risk-averse person will choose option D.
Scenario 3: A risk-averse person will choose option F.
Explanation:
a) Data and Calculations:
Scenario 1:
Option A Winning Expected
Probability Value
50% $1,000 $500
50% 0 0
Total winning = $500
Option B Winning Expected
Probability Value
100% $500 $500
0% 0
Total winning = $500
Scenario 2:
Option C Winning Expected
Probability Value
40% $90 $36
60% 110 66
Total winning = $102
Option D Winning Expected
Probability Value
100% $90 $90
Scenario 3:
Option E Winning Expected
Probability Value
50% $0 $0
50% 100 50
Total winning = $50
Option F Winning Expected
Probability Value
50% $20 $10
50% 60 30
Total winning = $40
b) The risk-averse person tries to avoid risks at all times. Her choice of investment favors an option that has a 100% probability of winning, thereby eliminating risks in all ramifications. This is why she is never indifferent between two options as she factors in the probability of losing.
Answer:
quick ratio = 4.77
Explanation:
quick ratio = (current assets - inventory) / current liabilities
current assets = $910,000 + $1,330,000 + $1,050,000 = $3,290,000
inventory = $1,050,000
current liabilities = $470,000
quick ratio = ($3,290,000 - $1,050,000) / $470,000 = 4.766 ≈ 4.77
They don’t use a circular flow chart because it don’t give a precise answer to what they are answering.
In pursing its own interest, an oligopoly firm will decide to increase production by 1 unit as long as the output effect is larger than the price effect. An oligopoly happens when there is limited competition because there are only a small number of producers or sellers in the market. Due to limited competition there is no need for most of these businesses to produce more unless the output is going to produce more and become sustainable for their consumers demand.