Modern economists measure how much utility Fred gets from a hot dog by
A. asking Fred how many utils he gets from its consumption.
B. examining the price of the hamburger Fred chose not to buy.
C. asking Fred how much of some other good he would give up to get the hot dog. The “other good” can be any good except money.
D. asking Fred how much of some other good he would give up to get the hot dog. The “other good” can be any good, including money.
Answer: D
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When marginal private cost is equal to marginal social cost,
A. the activity in question generates no positive externality. B. the activity in question generates no negative externality. C. all positive externalities have been internalized. D. all negative externalities have been internalized. E. b or d
Suppose hypothetically that the consumer price index (CPI) was 150 in Year 1 and was 180 in Year 2 . What would be the inflation rate for this period?
a. 12 percent. b. 16.7 percent. c. 20 percent. d. 30 percent.
The United States has used export subsidies to encourage the exportation of
a. steel. b. agricultural products. c. automobiles. d. computers.
What is the likely result for the gains from specialization according to the concept of diminishing returns?
What will be an ideal response?