Refer to the accompanying table. If the price of a t-shirt is $6 and the price of a sweater is $80, then the rational spending rule is satisfied when the consumer purchases ________ t-shirts and ________ sweaters. UnitsUtils Per Year from T-shirtsUtils Per Year from Sweaters0001754002135720318096042101120
A. 4; 4
B. 3; 4
C. 4; 3
D. 4; 1
Answer: D
You might also like to view...
The proposition that if property rights exist and are enforced, then private transactions are efficient is referred to as the
A) Coase theorem. B) property rights theorem. C) pollution rights theorem. D) emission rights theorem. E) private-market efficiency theorem.
Within the framework of the aggregate expenditures model, what will happen if an economy is operating at a real GDP greater than full-employment real GDP?
a. An inflationary gap exists. b. Real GDP will fall. c. The inventories of firms will rise. d. Firms will cut back on their current rate of output.
The crowding-out effect refers to the situation where
A. foreign spending is favored over domestic spending. B. government borrowing reduces private sector borrowing and spending. C. the United States Treasury prints new money that the government uses to force increases in private investment. D. the creation of large amounts of money to finance government borrowing produces an inflation that forces private spending to decrease.
Which of the following factors would indicate an inelastic demand?
A. The good is a necessity, rather than a luxury. B. The good represents a small fraction of the budget. C. Demand is measured over a shorter period of time. D. All of these