Given a set amount of money, goods A and B both give the same marginal utility at current levels of consumption but good A costs twice as much as good B. You should:
A. realize that you don't have enough information to answer the question.
B. consume more of good B and less of good A.
C. consume more of good A and less of good B.
D. keep consuming the current amounts of both good A and good B.
Answer: B
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Which of the following is a drawback to having a common currency across countries, as in the European Union?
A) Having a common currency implies that the prices of goods across countries must always be the same, regardless of consumer preferences for goods across countries. B) A common currency increases barriers to trade across countries, reducing opportunities for economic growth. C) With a common currency, individual countries are no longer able to run independent monetary policies. D) None of the above is a drawback to a common currency.
A firm's incentive to compare marginal revenue and marginal cost is an application of the principle that rational people think at the margin
a. True b. False Indicate whether the statement is true or false
When the government enacts policies to redistribute income,
a. the objective is to enhance efficiency and a side effect is that the allocation of resources becomes more equal. b. the objective is to enhance efficiency and a side effect is that the allocation of resources becomes less equal. c. the objective is to enhance equality and a side effect is that the allocation of resources becomes more efficient. d. the objective is to enhance equality and a side effect is that the allocation of resources becomes less efficient.
In commercial banking operations, there is a trade-off between liquidity and profitability
a. True
b. False
Indicate whether the statement is true or false