The price of hamburgers is $2 and the price of brownies is $4. The consumer has $14 of income. The consumer is purchasing 3 hamburgers and receiving 30 utils for the last hamburger. He is also purchasing 2 brownies and receiving 40 utils for the last
brownie. This set of goods
A) is an optimum since the entire income is spent and the marginal utility per dollar spent is the same for the last unit of each good.
B) is an optimum since the entire income is spent and total utility is maximized.
C) is not an optimum because the marginal utility per dollar spent is greater for hamburgers than for brownies.
D) is not an optimum because the consumer has not spent all of his money.
Answer: C
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Suppose the U.S. GDP growth rate is faster relative to other countries' GDP growth rates. This will
A) shift the aggregate demand curve to the left. B) move the economy up along a stationary aggregate demand curve. C) shift the aggregate demand curve to the right. D) move the economy down along a stationary aggregate demand curve.
An increase in the expected price level lead to
a. higher money wages and lower real wages. b. higher money wages and real wages. c. no change in money wages but lower real wages. d. lower money wages and higher real wages.
Which of the following provides a longer run measure of the exchange rate?
a. purchasing power parity (PPP) b. exchange rate c. GDP per capita d. GDP
The ________ determines the supply of money.
A. Congress B. President C. Federal Reserve D. banking system