If the marginal utility of a product is diminishing relative to the marginal utility of other products, then _____
a. the consumer is in equilibrium
b. the consumer has been purchasing relatively less of the product
c. the consumer has been purchasing relatively more of the product
d. the price of the product must have increased
e. the price of the product must have decreased
c
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The concept of opportunity cost exists because
A) of scarcity. B) goods have different prices. C) of shortages. D) the value of services is hard to determine.
The median voter must have preferences that reflect those of all people in the community.
A. True B. False C. Uncertain
Suppose that a powerplant is given a permit to pollute 10 tons of carbon into the atmosphere. As the powerplant operates, it can generate $200 of profit selling electricity per ton of carbon that it sends into the atmosphere. If the price of the carbon permit is $100 per ton, then:
A. the powerplant is better off shutting down and selling its permit. B. the powerplant is better off buying more permits and selling more electricity. C. the powerplant is better off selling electricity and using the permits to pollute 10 tons of carbon. D. the powerplant is better off shutting down and buying more permits.
The case for product differentiation does not include the fact that
A. products that satisfy a real demand survive. B. it wastes society's scarce resources. C. new products satisfy people with different preferences. D. standards of living rise with product innovation.