By selecting a bundle where MRS = MRT, the consumer is
A) achieving a corner solution.
B) reaching the highest possible indifference curve she can afford.
C) not behaving in an optimal way.
D) All of the above.
B
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An alternative to maintaining an overvalued currency is to ________ the fundamental value of the exchange rate by ________ monetary policy.
A. increase; easing B. decrease; tightening C. decrease; easing D. increase; tightening
In which of the cases given below will the elasticity of demand for workers who produce yo-yos be most inelastic? The price elasticity of demand for yo-yos is:
A. 5, and labor's share of total costs is 20 percent B. 5, and labor's share of total costs is 75 percent C. .1, and labor's share of total costs is 20 percent D. .1, and labor's share of total costs is 75 percent
Refer to Figure 21.1. If Area I = 1,700 and Area J = 3,300, what is the Gini coefficient?
A) 0.17 B) 0.34 C) 0.52 D) 2.94
If a natural monopoly does not inflate its costs, the output it produces is the smallest when the monopoly is
A) left unregulated. B) regulated according to an average cost pricing rule. C) regulated according to a marginal cost pricing rule. D) regulated to maximize total surplus.