If a consumer is consuming a combination of goods and services on his budget line, has the consumer allocated his or her entire budget?
What will be an ideal response?
Yes, the consumer has allocated his or her entire budget because the consumer is spending his or her entire budget.
You might also like to view...
A bond is selling for $1000 and it pays $150 in interest a year. If the interest rate changes to 20 percent, then
A) the price of the bond falls to $750. B) the interest payment falls to $75. C) the interest payment rises to $200. D) the price of the bond rises to $1500.
The aggregate demand curve
A) is like individual demand curves in that prices of other goods are held constant. B) is like individual demand curves in that income is constant. C) differs from individual demand curves in that the aggregate demand curve is not downward sloping. D) differs from individual demand curves in that the aggregate demand curve looks at the entire circular flow of income and product while the individual demand curve looks at only one good.
The president of the Federal Reserve Bank of which district has a permanent vote in the Federal Open Market Committee?
a. San Francisco. b. New York. c. Chicago. d. Atlanta e. Boston.
The last time a recession hit the country of Valtonia, the price of real estate fell significantly. When Craig learns that this country's stock market has crashed, he immediately decides to sell his houses. This is an example of the theory of _____
a. absolute advantage b. rational expectations c. adaptive expectations d. sticky wages