Multiple Choice
-James has a utility of wealth schedule in the above table. He is offered a job selling video games at Games Galore. James' compensation depends on how much he sells. In a poor sales period, a salesperson makes $100 per month. In a good sales period, a salesperson makes $600 per month. James is told by the manager that, in any given month, there is a 25 percent chance of a poor sales period and a 75 percent chance of a good sales period. What is James' expected utility from taking this job?
A) 100
B) 150
C) 175
D) 200
Correct Answer:

Verified
Correct Answer:
Verified
Q2: Expected wealth is a weighted average in
Q3: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB8586/.jpg" alt=" -Roy owns a
Q4: Joe is contemplating a job where, with
Q5: When Sardar buys insurance, on net he<br>A)
Q6: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB8586/.jpg" alt=" -John's utility of
Q7: In the used car market, adverse selection
Q8: Warranties in the used car market _
Q9: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB8586/.jpg" alt=" -Beachcomber Beatrice spent
Q10: A risk-averse person's marginal utility of wealth<br>A)
Q11: One way of reducing the moral hazard