The change in the consumption of one good that just offsets a one-unit change in the consumption of another good is the
A. marginal rate of satisfaction.
B. marginal rate of consumption.
C. marginal rate of substitution.
D. marginal utility.
Answer: C
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The Keynesians believe that
a. the Fed played a primary role in driving the Great Depression. b. the Fed played an important role in preventing the Great Depression from being worse than it could have been. c. the Fed played a negative but secondary role in the Great Depression. d. the Federal Reserve did all it could to prevent the Great Depression but essentially played no role in it.
Capitalistic System
What will be an ideal response?
If the economy is currently in a recessionary gap,
A) all economists will agree that the economy can remove itself from the recessionary gap without government intervention. B) some economists will argue that the economy can remove itself from the recessionary gap without government intervention. C) no economist will state that the economy can remove itself from the recessionary gap without government intervention. D) all economists will agree that over time the recessionary gap will worsen.
Which of the following reduces the interest rate?
a. an increase in government expenditures and an increase in the money supply b. an increase in government expenditures and a decrease in the money supply c. a decrease in government expenditures and an increase in the money supply d. a decrease in government expenditures and a decrease in the money supply