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Unformatted text preview: lose it and be left with nothing. The jeweler oers insurance against the possibility of loss at the price of 25 cents ($0.25) for each dollar of protection. You can buy any amount of this insurance, positive or negative. Let c l and c nl represent your wealth in the cases that it lose and do not lose it, respectively. Which equation best characterizes the set of possible combinations of c l and c nl ? (a) c nl = 100-c l 4 (b) c nl = 80-c l 3 (c) c nl = 60-c l 5 (d) c nl = 75-c l 3 2...
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This note was uploaded on 12/26/2011 for the course ECON 100B taught by Professor Kilenthong during the Fall '08 term at UCSB.
- Fall '08