A bottle of wine costs $8 and a quiche costs $5 . At Robert's present levels of consumption, he spends all his income and receives marginal utility of $10 from the last bottle of wine and marginal utility of $4 from the last quiche. To maximize his total utility, Robert should
a. buy less wine and more quiche.
b. buy more wine and less quiche.
c. spend all of his money on wine.
d. change his spending pattern until he buys 8/5ths as much wine as quiche.
b
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Assume someone organizes all farms in the nation into a monopoly. Which of the following occurs? i. Consumer surplus decreases. ii. Economic profit increases. iii. A deadweight loss is created
A) i only B) ii only C) iii only D) i and ii E) i, ii, and iii
At the competitive equilibrium:
A) the demand curve is tangential to the supply curve. B) the quantity demanded exceeds the quantity supplied of a good. C) the quantity supplied exceeds the quantity demanded of a good. D) the quantity demanded is equal to the quantity supplied of a good.
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b. the prime rate. c. the discount rate. d. the federal funds rate. e. the required reserve ratio.
When economists speak of a firm's costs, they are usually excluding the opportunity costs
a. True b. False Indicate whether the statement is true or false