The consumer optimum for consuming two goods is achieved when
A) the total utility from each good is equal.
B) the price of each good is equal.
C) the price multiplied by the marginal utility is equal for the two goods.
D) the marginal utility per last dollar spent is equal for the two goods.
Answer: D
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Refer to Game Matrix III. The Nash equilibrium is to be found where
Game Matrix III
The following questions refer to the game matrix below. Each firm has a choice of advertising, Ads, or not advertising, No ad. The profits each gets depend upon which it chooses.
a. neither firm advertises.
b. Firm A advertises, Firm B does not.
c. Firm A does not advertise but Firm B does.
d. both firms choose to advertise.
If a union is able to decrease the supply of workers in a competitive labor market but the union cannot affect the demand for its members' labor, then
A) wages and the quantity of labor hired will both increase. B) wages will increase but the quantity of labor hired will decrease. C) wages will decrease but the quantity of labor hired will increase. D) wages and the quantity of labor hired will both decrease.
Which of the following is most likely to be a variable cost?
A. Fuel and power payments. B. Interest on business loans. C. Rental payments on IBM equipment. D. Real estate taxes.
Suppose a policy change will generate $180,000 of benefits for low-income families and $150,000 of costs for high-income and middle-class families. This change can best be described as
A. equitable. B. inefficient. C. Pareto efficient. D. potentially efficient.