The statement "as more of a good is consumed, the utility a person derives from each additional unit diminishes" is known as the:
a. water and diamond paradox.
b. law of diminishing marginal utility.
c. law of total utility.
d. marginal-utility-to-price ratio equalization rule.
e. law of diminishing demand.
b
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Games:
A. only have one outcome possible. B. with noncooperative equilibriums are always negative-negative outcomes. C. may have several stable outcomes. D. must have a dominant strategy present to reach a stable equilibrium.
Which of the following situations is used as a justification for government?
A) negative externalities B) removal from the prisoner's dilemma C) nonexcludable goods D) positive externalities E) all of the above
Which of the following has the longest lag time for the Federal Reserve?
a. reducing production output b. increasing employment c. reducing government bonds d. increasing full price levels
Assume the economy is at point D. What would happen to AD2 and the point of equilibrium if P increased to 110 while the autonomous parts of consumption, investment, government purchases, and net exports remained constant?
a. AD2 would shift right, and the point of equilibrium would move right.
b. AD2 would shift left, and the point of equilibrium would move left.
c. AD2 would not move, but the point of equilibrium would move left.
d. AD2 would not move, but the point of equilibrium would move right.