Marginal Analysis Studies How Individuals Decide

question 4

Multiple Choice

Marginal analysis studies how individuals decide:

• A)whether to live on the margin of society.
• B)whether to do a bit more of an activity versus a bit less of it.
• C)whether to go to college.
• D)how much down payment to make when buying stocks.

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Definitions:

Lower In Priority

A status indicating lesser importance or urgency in comparison to other items or tasks.

Convertible Bond

A bond that can be converted into a specified number of shares of stock at the owner’s discretion.

Conversion Price

The predetermined price at which convertible securities can be converted into common stock.

Conversion Ratio

A ratio set at the time bonds are issued; determines the number of shares that can be exchanged for a bond.