Lisa consumes only pizzas and burritos. In equilibrium, her marginal utility of pizza is 20 and her marginal utility of a burrito is 10. The price of a pizza is $4. What is the price of a burrito?
What will be an ideal response?
In equilibrium, the ratio of the marginal utility of a pizza divided by the price of a pizza must equal the marginal utility of a burrito divided by the price of a burrito. Thus, the price of a burrito must be $2.
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Alternate Outputs from One Day's Labor Input: United States: 12 bushels of wheat or 3 yards of textiles. Great Britain: 3 bushels of wheat or 12 yards of textiles. From the data above, the United States
a. has an absolute advantage over Great Britain in the production of textiles. b. has an absolute advantage over Great Britain in the production of wheat. c. has a comparative advantage in the production of textiles d. should export textiles to Great Britain.
Excise taxes are a form of sales tax.
Answer the following statement true (T) or false (F)
Economic efficiency is achieved at a particular output level if:
A. average fixed cost is as low as possible. B. average total cost is as low as possible. C. average variable cost is as low as possible. D. marginal cost is as low as possible.
An appreciation is
A) a decrease in the trade deficit. B) a decrease in the value of currency. C) an increase in the trade surplus. D) an increase in the value of currency.