Answer:
A. pivot rightward (pivot out) along the horizontal axis
Explanation:
Tea and coffee represent substitute goods. If price of a good increases, this causes an increase in quantity demanded of it's substitute.
In the given case, quantity demanded of tea is measured on horizontal axis while quantity demanded of coffee is measured on vertical axis. The budget constraint for tea and coffee shows different combinations of quantity of tea and coffee demanded within a fixed expenditure.
When price of coffee increases, within the same budget constraint, the quantity demanded of tea shall rise.
This would lead to the budget constraint to pivot rightward (pivot out) along the horizontal axis.
An example of "Framing" is that a person may reject an investment when it is posed in terms of risk surrounding potential gains, but may accept the same investment if it is posed in terms of risk surrounding potential losses.
<u>Explanation:</u>
A cognitive bias (systemic fault in one's thinking) where people suggest or decide whether the choices to be viewed as plus or minus implications, instance like loss or a gain and understood as Framing effect.
People tend to avoid risk when presenting a successful frame but look for risks when presenting a negative frame. Individuals will phrase their material in such a way as to force you to join.
For an instance, a musician could say millions are listening to them. You might want to participate because that is what so many other people do.
Answer:
The numbers are missing, so I looked for a similar question (see attached image).
- the expected value for option A (modernize everything) = (0.5 x $90,000) + (0.5 x $25,000) = $57,500
- the expected value for option B (modernize only second floor) = (0.4 x $80,000) + (0.6 x $70,000) = $74,000
- the expected value for option C (do nothing) = (0.3 x $60,000) + (0.7 x $33,000) = $41,100
The option with the highest expected value is option B (modernize only second floor).
