Ask Question, Ask an Expert


Ask Microeconomics Expert

An individual wants to start a business at which he expects to make 50,000$. Getting a license for the business costs 35,000$. The chance of getting caught without a license is 1/10, in which case he gets a fine of 50,000 $. Would he get a license if he is risk averse with utility U(x) = √x ? What happens if the probability of getting caught increases to ½? Can you propose an alternative to increasing law enforcement?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M945644

Have any Question? 

Related Questions in Microeconomics

Economics problem set-question 1 sometimes goods are

Economics Problem Set- QUESTION 1: Sometimes goods are rationed, so people cannot buy as much as they want at the announced price. A good example is Super bowl tickets, which are sold at below market price. Suppose that ...

Assignmentuse the globaledge website to complete the

Assignment Use the globalEDGE website to complete the following exercises: • The World Trade Organization maintains a database of regional trade agreements. You can search this database to identify all agreements that a ...

Question 1 suppose you are given the following information

Question 1: Suppose you are given the following information about an industry: Q D = 8000 - 100p; Q S SR = 20 + 700p; c(q) = 20 + q 2 /20. where q and c (q) stand for a firm's quantity supplied and cost function; Q S SR ...

Recall from lecture the two facts we discussed one no

Recall from lecture the two facts" we discussed: One, no product exists at a vacuum; and two relationships among products change over time. Recall the background factors of demand: consumer preferences/ Wants; consumer i ...

Acts of possessioncarefully read acts of possession which

Acts of Possession Carefully read "Acts of Possession," which covers European modes of possessing land and justifying colonization in the Americas. Write a short essay Addressing the following: What common features or as ...

Assignmentin 2014 southwest airlines was the market share

Assignment In 2014, Southwest Airlines was the market share leader in domestic air travel in the United States. Widely known for its low fares and pleasing customer service, Southwest transported more passengers from U.S ...

Question 1nbspgiven the following chart answer the

Question 1  Given the following chart answer the questions below, assuming that all resources and technology are fixed for this farm. Corn(bu) Soybeans(bu) 20,000 0 16,000 5000 12,000 9000 8,000 12,000 4,000 14,000 0 15, ...

1 mary has two possible career paths she can become either

1. Mary has two possible career paths. She can become either a biologist or a concert pianist. Mary lives for 2 periods. In the first period she gets the appropriate education for her career. In the second period, she wo ...

Brainy brian eco discussiondiscussion topic is the lost

Brainy Brian ECO discussion Discussion topic is The Lost Decade: Needs to be 150-250 words and one or two citations. No cover page is needed Aggregate expenditure is the total amount of spending in the economy that deter ...

Assignmentbenefiting administration is a strong part of the

Assignment Benefiting administration is a strong part of the employee value propositions. Compare three organizations and how these organizations have demonstrated best practices in offering employee benefits. Additional ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate