A Person Who Wins a Large Sum of Money in the State

question 71

Multiple Choice

A person who wins a large sum of money in the state lottery is _____

• A)likely to increase the amount of market work offered at each wage rate.
• B)not likely to change the amount of work offered at each wage rate.
• C)likely to decrease the amount of work offered at each wage rate.
• D)likely to substitute market work for leisure time because of the substitution effect.
• E)likely to substitute market work for leisure time because of the income effect.

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Definitions:

Coinsurance Clause

A provision in an insurance policy that requires the policyholder to bear a portion of the losses to the extent specified in the policy.

Fair Market Value

The price that a knowledgeable, willing, and unpressured buyer would pay to a knowledgeable, willing, and unpressured seller in the market.

Insurance Proceeds

The money received from an insurance claim, which compensates for a loss or damage.

Subrogation Clause

A provision in an insurance policy allowing the insurer to take legal action in the name of the insured against a third party responsible for the insured’s loss.