Describing risk, Microeconomics

Describing Risk

* To measure risk we should know:

 1) All the outcomes which are possible.

 2) The probability that each outcome will occur.

* Interpreting Probability

- The probability of the given outcome to occur

* Interpreting Probability

- The probability which the given outcome will occur

- Objective Interpretation

  • Based on frequency which is observed of past events

- Subjective

  • Based on experience or perception with or without an observed frequency

-  Different information or abilities to process the same information can influence subjective probability 

Posted Date: 10/10/2012 8:15:52 AM | Location : United States







Related Discussions:- Describing risk, Assignment Help, Ask Question on Describing risk, Get Answer, Expert's Help, Describing risk Discussions

Write discussion on Describing risk
Your posts are moderated
Related Questions
Is there a trade-off between inflation and unemployment? The Keynesian side posits that policies can indeed be used to stimulate demand - demand-side policies - and those mar

what is aridge line and significance in economics.

illustrate and discuss implications of various market structure(non competitive and competitive) for price determination

what is the effect on the market for dvd players if the price of dvd rises

Mixed Economy: This type of economic system combines the features of both the capitalist and socialist economic systems. The private sector is allowed to function on the principles

1. Igora's pizzeria want to know if it should stay open this spring. Total Revenue will be $ 12,000 per week and Total Cost will be $ 18,000 per week. The fixed cost of running the

Output 0 Fixed cost $100 Varaible Cost 40 what is the Total cost and Total revenue also the Profit/Loss

Change in consumer Taste/preference: Any change in consumer taste or preference causes demand to change. Increased taste or preference for a particular good causes demand to inc


Long run equilibrium - Perfect competition: In the long-run, on the other hand, the firm in perfect competition is making normal profit or zero economic profit as shown in Fig