The Amount of Pleasure or Satisfaction Derived from Consumption of a Good

question 36

Multiple Choice

The amount of pleasure or satisfaction derived from consumption of a good is called

• A) elasticity.
• B) utility.
• C) consumer surplus.
• D) demand.

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Definitions:

Diversification

Reducing risk by investing in several different things, so that the possible losses are independent events.

Pooling

A strong form of diversification in which an investor takes a small share of the risk in many independent events, so the payoff has very little total overall risk.

Risk Reduction

Strategies or actions implemented to minimize the probability or impact of negative events or losses.

Market for Risk

A financial market where individuals and institutions trade financial instruments to manage risk exposure.