Use the Following to Answer Questions

question 5

Multiple Choice

Use the following to answer questions:
-(Table: Income and Utility for Tyler) The table Income and Utility for Tyler shows the utility Tyler receives at various income levels, but she does not know what her income will be next year. There is a 40% chance her income will be $20,000, a 40% chance her income will be $30,000, and a 20% chance her income will be $40,000. What is her expected income?

• A) $28,000
• B) $29,000
• C) $30,000
• D) $31,000

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Definitions:

Demand

The desire of consumers to purchase goods and services at given prices, which is a fundamental concept in economics determining market dynamics.

Long-Run Average Cost Curve

A graphical representation showing the minimum average cost at which any output level can be produced when all inputs are variable in the long run.

Short-Run

A timeframe in economics where at least one input, such as capital or labor, is fixed, limiting the ability of businesses to adjust production immediately.

Tangent

In economics, it represents a point where two curves touch, often used in optimization problems to find equilibrium points.