Assume that Sofia's marginal utility from pizza consumption is 10 utils and the price is $2.00 per slice. Further, assume that her marginal utility from scone consumption is 20 utils and the price is $3.00 per scone. Which of the following is true?
a. With her existing budget she should increase her consumption of pizza
b. With her existing budget she should increase her consumption of scones.
c. She is currently maximizing her utility and should not change the amount of consumption for either good with her current budget.
d. If her budget increases, she should increase her consumption of pizza but not scones.
e. If her budget increases, she should increase her consumption of scones but not pizza.
b
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Explain how unemployment changes over the business cycle. Why do these changes occur?
What will be an ideal response?
After 2 years of operation, the workers in XYZ Co become more adept because of their repeating work. As a result, the average cost of production is lowered due to
A) economies of scale. B) increasing returns to scale. C) increasing marginal returns. D) learning by doing.
Unions may cause unemployment if:
A. outsiders push wages down. B. insiders force real wages higher than the market-clearing level. C. outsiders are subject to minimum-wage legislation. D. insiders are fired and outsiders are hired.
Which of the following statements about pollution or pollution control is TRUE?
A. The optimum amount of pollution abatement is where the total benefits of pollution abatement equal the total costs of pollution abatement. B. Private costs of pollution usually exceed social costs. C. A tax to reduce pollution levels should be based on the economic damages rather than on the absolute amount of pollution. D. A nationwide uniform tax on emissions is the appropriate way to reduce pollution levels.