The marginal rate of substitution is equal to the ________
A) marginal cost of each good
B) magnitude of the slope of the indifference curve
C) inverse of the slope of the budget line
D) relative price of the two goods
B
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A cut in the income tax rate ________ the tax wedge and ________ employment, saving, and investment
A) decreases; increases B) increases; increases C) does not change; increases D) decreases; does not change E) increases; decreases
Price discrimination
A. Is illegal. B. Rarely occurs in the airline industry. C. Is a method used by sellers to pit one buyer against the other. D. Is a way for sellers to elicit the maximum willingness to pay from buyers.
An economy’s production possibilities curve could shift outward as a result of a(n)
a. increased level of technology. b. reduction in the quantity of capital goods. c. decrease in the production of goods. d. decrease in the amount of available resources.
Alex is playing his music at full volume in his dorm room. The other people living on his floor are enjoying his music, but Alex does not know or care. Alex's music playing is an example of a:
A. Pareto externality. B. negative externality. C. normative externality. D. positive externality.