Biology Forums - Study Force

Someone who values a lottery at more than the expected value is
 a. a risk lover
  b. risk neutral
  c. risk averse
  d. one who tends to play lots of lotteries

QUESTION 2

A natural monopoly:
 a. is a monopoly in the production of raw materials.
  b. occurs when one firm can supply the entire market more cheaply than can a number of firms.
  c. is one result of a patent.
  d. necessarily involves inefficient pricing.

QUESTION 3

In determining the optimal capital budget, one should choose those project's whose ____ exceeds the firm's ____ cost of capital.
 a. internal rate of return, average
  b. internal rate of return, marginal
  c. internal rate of return, historic
  d. average rate of return, marginal
  e. none of the above

QUESTION 4

Someone who values a lottery at less than the expected value is
 a. a risk lover
  b. risk neutral
  c. risk averse
  d. one who tends to play lots of lotteries

QUESTION 5

Which of the following is not a technical barrier to entry in a monopolized market?
 a. A patent
  b. Decreasing average cost
  c. A low cost method of production known only by monopolists
  d. Increasing returns to scale

QUESTION 6

The relationship between NPV and IRR is such that :
 a. both approaches always provide the same ranking of alternatives
  b. the IRR of a project is equal to the firm's cost of capital when the NPV of a project is 0
  c. if the NPV of a project is negative, then the IRR must be greater than the cost of capital
  d. all of the above
  e. none of the above

QUESTION 7

An individual who is a risk lover
 a. values a lottery at more than its expected value
  b. values a lottery at exactly its expected value
  c. values a lottery at less than its expected value
  d. tends to play lots of lotteries

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