For a Risk-Averse Individual, as Wealth Increases, Total Utility ________

question 107

Multiple Choice

For a risk-averse individual, as wealth increases, total utility ________ and marginal utility ________.

• A) increases; increases
• B) increases; decreases
• C) decreases; increases
• D) decreases; decreases

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Definitions:

Proximity

Physical or geographic closeness; a major influence on attraction.

Interpersonal Attraction

The force that draws people together, leading to friendships and romantic relationships.

Mere-Exposure Effect

The tendency to feel more positively toward a stimulus as a result of repeated exposure to it.

Repeated Exposure

involves the process by which repeated encounters with a stimulus lead to an increased liking for or familiarity with that stimulus.