Economics (6th Edition)
6th Edition
ISBN: 9780134105840
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 10, Problem 10.4.16PA
Subpart (a):
To determine
How to apply the concept of behavioral economics.
Subpart (b):
To determine
How to apply the concept of behavioral economics.
Subpart (c):
To determine
How to apply the concept of behavioral economics.
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In Behavioral Economics, what does it mean to say that people like to “play with the house’s money”? What is wrong with that phrase?
Suppose you and your friend go out for dinner. Your friend orders a cheeseburger and fries. When your food first arrives, you ask your friend if you can have one of his fries. He looks at you like you are crazy and says, "No!" Then a few minutes later, after you both have started eating, you ask again, and your friend reluctantly says, "Sure. Go ahead."
An economist's explanation for your friend's change of heart is most likely to be that:
Your friend's total utility declines as he eats more fries, so he's more likely to share with you after he's eaten a few.
Your friend's marginal utility from eating additional fries declines as he eats more of them, so he's more likely to share with you after he's eaten a few.
Your friend's total utility increases as he eats more fries, so he's more likely to share with you after he's eaten a few.
Your friend's marginal utility from eating additional fries increases as he eats more of them, so he's more likely to share with you…
Suppose you and your brother go out for dinner. Your brother orders a cheeseburger and fries. When the food first arrives, you ask your brother if you can have a few fries. He looks at you like you're crazy, and says, "No!" Then a few minutes later, after you've both started eating, you ask again, and your brother reluctantly says, "Sure. Go ahead." An economist's explanation for your brother's change of heart is most likely to be that
your brother's marginal utility from eating additional french fries declines as he eats more of them, so he's more likely to share with you after he's eaten a few.
your brother's total utility increases as he eats more french fries, so he's more likely to share with you after he's eaten a few.
your brother's marginal utility from eating additional french fries increases as he eats more of them, so he's more likely to share with you after he's eaten a few.
your brother's total utility declines as he eats more french fries, so…
Chapter 10 Solutions
Economics (6th Edition)
Ch. 10.A - Prob. 1RQCh. 10.A - Prob. 2RQCh. 10.A - Prob. 3RQCh. 10.A - Prob. 4PACh. 10.A - Prob. 5PACh. 10.A - Prob. 6PACh. 10.A - Prob. 7PACh. 10.A - Prob. 8PACh. 10.A - Prob. 9PACh. 10.A - Prob. 10PA
Ch. 10.A - Prob. 11PACh. 10.A - Prob. 12PACh. 10 - Prob. 10.1.1RQCh. 10 - Prob. 10.1.2RQCh. 10 - Prob. 10.1.3RQCh. 10 - Prob. 10.1.4RQCh. 10 - Prob. 10.1.5PACh. 10 - Prob. 10.1.6PACh. 10 - Prob. 10.1.7PACh. 10 - Prob. 10.1.8PACh. 10 - Prob. 10.1.9PACh. 10 - Prob. 10.1.10PACh. 10 - Prob. 10.1.11PACh. 10 - Prob. 10.1.12PACh. 10 - Prob. 10.2.1RQCh. 10 - Prob. 10.2.2RQCh. 10 - Prob. 10.2.3RQCh. 10 - Prob. 10.2.4PACh. 10 - Prob. 10.2.5PACh. 10 - Prob. 10.2.6PACh. 10 - Prob. 10.2.7PACh. 10 - Prob. 10.2.8PACh. 10 - Prob. 10.2.9PACh. 10 - Prob. 10.2.10PACh. 10 - Prob. 10.2.11PACh. 10 - Prob. 10.3.1RQCh. 10 - Prob. 10.3.2RQCh. 10 - Prob. 10.3.3RQCh. 10 - Prob. 10.3.4PACh. 10 - Prob. 10.3.5PACh. 10 - Prob. 10.3.6PACh. 10 - Prob. 10.3.7PACh. 10 - Prob. 10.3.8PACh. 10 - Prob. 10.3.9PACh. 10 - Prob. 10.4.1RQCh. 10 - Prob. 10.4.2RQCh. 10 - Prob. 10.4.3RQCh. 10 - Prob. 10.4.4RQCh. 10 - Prob. 10.4.5PACh. 10 - Prob. 10.4.6PACh. 10 - Prob. 10.4.7PACh. 10 - Prob. 10.4.8PACh. 10 - Prob. 10.4.9PACh. 10 - Prob. 10.4.10PACh. 10 - Prob. 10.4.11PACh. 10 - Prob. 10.4.12PACh. 10 - Prob. 10.4.13PACh. 10 - Prob. 10.4.14PACh. 10 - Prob. 10.4.15PACh. 10 - Prob. 10.4.16PA
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