If Mr. Smith thinks the last dollar spent on shirts yields more satisfaction than the last dollar spent on cola, and Smith is a utility-maximizing consumer, he should
a. decrease his spending on cola.
b. decrease his spending on cola and decrease his spending on shirts.
c. decrease his spending on shirts.
d. increase his spending on cola and decrease his spending on shirts.
A
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In a competitive market when there is no deadweight loss
A) consumer surplus is minimized. B) producer surplus is minimized. C) consumer surplus plus producer surplus is maximized. D) consumer surplus plus producer surplus is minimized.
When there are two coefficients, the resulting confidence sets are
A) rectangles. B) ellipses. C) squares. D) trapezoids.
The deadweight loss of a tax rises even more rapidly than the size of the tax
a. True b. False Indicate whether the statement is true or false
The actual exchange rate of the real, Brazil's currency, is 2.50 real per U.S. dollar. According to the latest PPP estimations, the real is undervalued by 40 percent. This implies that the PPP exchange rate is:
A. 1.40 real per dollar. B. 1.20 real per dollar. C. 1.50 real per dollar. D. 2.00 real per dollar.