Pearson eText Economics -- Instant Access (Pearson+)
13th Edition
ISBN: 9780136879459
Author: Michael Parkin
Publisher: PEARSON+
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Chapter 20.1, Problem 3RQ
To determine
Identify the reason behind the people’s decision under uncertainty.
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Chapter 20 Solutions
Pearson eText Economics -- Instant Access (Pearson+)
Ch. 20.1 - Prob. 1RQCh. 20.1 - Prob. 2RQCh. 20.1 - Prob. 3RQCh. 20.1 - Prob. 4RQCh. 20.2 - Prob. 1RQCh. 20.2 - Prob. 2RQCh. 20.2 - Prob. 3RQCh. 20.2 - Prob. 4RQCh. 20.3 - Prob. 1RQCh. 20.3 - Prob. 2RQ
Ch. 20.3 - Prob. 3RQCh. 20.3 - Prob. 4RQCh. 20.4 - Prob. 1RQCh. 20.4 - Prob. 2RQCh. 20.4 - Prob. 3RQCh. 20 - Prob. 1SPACh. 20 - Prob. 2SPACh. 20 - Prob. 3SPACh. 20 - Prob. 4SPACh. 20 - Prob. 5SPACh. 20 - Prob. 6SPACh. 20 - Prob. 7APACh. 20 - Prob. 8APACh. 20 - Prob. 9APACh. 20 - Prob. 10APACh. 20 - Prob. 11APACh. 20 - Prob. 12APACh. 20 - Prob. 13APACh. 20 - Prob. 14APACh. 20 - Prob. 15APACh. 20 - Prob. 16APACh. 20 - Prob. 17APACh. 20 - Prob. 18APACh. 20 - Prob. 19APACh. 20 - Prob. 20APACh. 20 - Prob. 21APACh. 20 - Prob. 22APACh. 20 - Prob. 23APA
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- If you were a real estate agent, how would you determine whether it’s worth investing a significant amountof time in a particular prospect?arrow_forwardIf it is impossible to acquire sufficient information to make an informed decision, what can be the least risky option to take? Using gut feelings Not doing anything Do something because something is always better than nothing. Let someone else make the decision.arrow_forwardExplain in your own words what it means when an outcome is reliable?arrow_forward
- It is often costly to obtain the information necessary to make good decisions. Yet, your own interests can best be served by rationally weighing all options available to you. This requires informed decision making. Does this mean that making uninformed decisions is irrational? How do you determine how much information is the right amount?arrow_forwardPaul hires Amy to manage his bakery shop. The following table gives the shop's profits (without subtracting payments to Amy) under 3 different levels of Amy's effort and two different states of the world (good and bad weather). There is an 80% probability that the weather would turn good. Bad weather (20%) Good weather (80%) Low Effort 200 400 Medium Effort 400 800 High Effort 800 1000 The cost of low effort is $10, medium effort $20 and high effort $40. Paul offers a fixed salary of $100 and bonus B if revenue is equal to or higher than $800 and nothing otherwise. What should be the minimum value of B so that Amy would put high effort?arrow_forwardWrite a short note.arrow_forward
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- In the final round of a TV game show, contestants have a chance to increase their current winnings of$1 million to $2 million. If they are wrong, their prize is decreased to $500,000. A contestant thinks his guess will be right 50% of the time. Should he play? What is the lowest probability of a correct guess that would make playing profitable?arrow_forwardWhat are the decisions that people have usually made that incurred opportunity costs?arrow_forwardAa4arrow_forward
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