Assume that a combination of 10 bottles of wine and 2 cartons of milk lies on a consumer's budget constraint. If the price of one bottle of wine is $10, and one carton of milk is $1, what is the consumer's income?
A) $100
B) $20
C) $120
D) $102
D
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What would be an example of consumption service?
A) Rhianna gets a haircut. B) Jake buys an iPhone. C) Antonio, the manager of the local Taco Hut, purchases a new deep fryer. D) The local driver's license office purchases a new digital camera and printer. E) Donald Trump purchases furniture for his office.
In calculating the IS curve, _______ is taken as exogenous
a. the interest rate. b. aggregate income. c. the price level. d. planned investment. e. a and d.
A curve that represents all combinations of market baskets that provide the same level of utility to a consumer is called:
A) a budget line. B) an isoquant. C) an indifference curve. D) a demand curve. E) none of the above
Assume that a perfectly competitive increasing-cost industry is in long-run equilibrium when market demand suddenly increases. Which of the following statements is not correct?
a. Existing firms will earn economic profits in the new long-run equilibrium b. Existing firms will increase output in the short run c. New firms will enter the industry in the long run d. Some resource suppliers to the industry will earn higher income e. The new long-run equilibrium price will exceed the original equilibrium price