Regardless of which consumption bundle in her choice set a consumer chooses, she will spend all of her available income.
Answer the following statement true (T) or false (F)
False
Rationale: All available income is spent only on the portion of the choice set that is equal to the budget line (or budget constraint).
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A production function represents:
A. the relationship between the quantity of inputs and the quantity of outputs. B. the relative values of the inputs and modes of production. C. the relative costs of the inputs across various modes of production. D. the relationship between the cost of the inputs and the revenue generated by the outputs.
If Kobe, an NBA star athlete, earns $10 million per year but has no money in the bank, he has a
a. high income and high wealth. b. low income and high wealth. c. high income and low wealth. d. low income and low wealth.
Other things equal, the greater the interest rate:
A. the higher the NPV. B. the higher the PV. C. the lower the NPV. D. None of the statements associated with this question are correct.
D. a higher price level will decrease the real value of many financial assets and therefore reduce spending
A. increase the amount of U.S. real output purchased. B. increase U.S. imports and decrease U.S. exports. C. increase both U.S. imports and U.S. exports. D. decrease both U.S. imports and U.S. exports.