Darcy Enjoys a Day at the Racetrack and Doesn't Really

question 27

Multiple Choice

Darcy enjoys a day at the racetrack and doesn't really care if she ends up with a little more or little less money at the end of the day.What most likely influences Darcy's decision to go to the racetrack

• A) expected value
• B) subjective utility 
• C) unexpected value
• D) objective utility

---

Definitions:

Marginal Private Cost

The cost incurred by a firm or individual resulting from producing one more unit of a good, excluding externalities or effects on third parties.

External Benefits

External benefits refer to the positive effects or advantages that a product or activity imparts on individuals or society who are not directly involved in the production or consumption of the good.

Network Externalities

The effect on a user of a product or service that results from an increase in the number of other users of the same or compatible products or services.

Natural Monopolies

Market conditions where a single firm can supply a good or service more efficiently than any competitor due to economies of scale, hence dominating the market.