Utility theory assumes that marginal utility:
A. increases as an individual consumes more of a product.
B. decreases as an individual consumes more of a product.
C. is zero as long as the individual derives utility from the product.
D. is constant as long as the individual derives utility from the product.
Answer: B
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Lou and Alex live together and share household chores. They like to cook some meals ahead of time and eat leftovers. The table below shows the number of rooms they can each clean and the number of meals they can each cook in an hour. Rooms CleanedPer Hour Meals CookedPer HourLou54Alex33If Alex and Lou work out an efficient arrangement for these two chores, then under that arrangement:
A. Lou would do all of the cleaning and all of the cooking. B. Alex would do all of the cleaning, while Lou would do all the cooking. C. Alex and Lou each would do half of the cooking and half of the cleaning. D. Lou would do all of the cleaning, while Alex would do all of the cooking.
The utility function with respect to wealth is negatively sloped for a risk averse person
Indicate whether the statement is true or false
The Phillips curve is stable over time
Indicate whether the statement is true or false
When investment exceeds planned investment, aggregate planned expenditure is __________ than actual aggregate expenditure and inventories are __________ than planned
a) greater; greater b) greater; less c) less; greater d) less; less