Hillary Has an Initial Endowment of $500 and Is Interested

question 23

Multiple Choice

Hillary has an initial endowment of $500 and is interested in two things: how many visits she can make to the doctor and how much money will be left over to spend on other things.When a trip to the doctor costs $50, Hillary sees the doctor 7 times.After health care reform, a visit to the doctor will cost $10 but her taxes will rise by $360.

• A)Hillary will be made better off by health care reform.
• B)Hillary will be made worse off by health care reform.
• C)We cannot tell how health care reform will affect Hillary.
• D)Hillary violates the Weak Axiom of Revealed Preference.
• E)Hillary violates the Strong Axiom of Revealed Preference.

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Definitions:

Histogram

A graphical representation of data using bars of different heights, where each bar groups numbers into ranges, showing the frequency of data within each range.

Observations

Individual pieces of data collected during a study or experiment.

Relative Frequencies

The ratio of the number of times a particular value occurs to the total number of observations, often expressed as a percentage.

Histogram

A graphical representation of the distribution of numerical data, displayed as bars representing the frequency of data within certain ranges.