A consumer's utility is maximized when:
a. the dollar amount spent on each good is the same
b. the marginal utility of each good purchased is the same.
c. the price of each good is the same.
d. None of the above are generally true.
d
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The marginal physical product of labor is
A) the output of the firm divided by the number of workers. B) the change in total revenues resulting from the addition of one more worker, while increasing one other factor of production. C) the change in output resulting from the addition of one more worker, holding other factors of production constant. D) the change in output resulting from the addition of one more worker, adjusting the level of the capital stock accordingly.
(Consider This) In "Slicing the Pizza," the shrinkage of the pizza refers to the:
A. fact that poor people are not helped by the income-maintenance system. B. efficiency losses—the losses of output and income associated with the tax-transfer system. C. tendency of rich people in developing nations to hoard their wealth overseas. D. failure of the Internal Revenue Service to collect all the tax revenues owed by taxpayers.
A firm should never undertake an investment if the present value of the
A. income stream associated with the investment is greater than the full cost of the investment project. B. costs of the investment project are lower than the present value of the returns from the investment project. C. income stream associated with the investment is less than the full cost of the investment project. D. income stream associated with the investment is positive.
As real rates of interest increase in the economy, real investment spending increases
Indicate whether the statement is true or false