Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point A to Point E, the opportunity cost of motorcycles, measured in terms of hybrid cars
A. remains constant.
B. decreases.
C. initially increases, then decreases.
D. increases.
Answer: D
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Total utility is maximized when
A. Marginal utility is zero. B. Price is equal to marginal utility. C. Price is less than marginal utility. D. Marginal utility is maximized.
What impact do private insurance companies and Medicare have on national medical costs?
A. Medical costs go down because the insurance company pays the bill. B. Medical costs go up because insurance leads to an increase in the quantity demanded of medical services. C. Medical cost are unaffected by insurance companies. D. Medical costs go up because insurance will lead to the reduction in the supply of medical services due to the amount of paperwork required.
Price elasticity of demand is calculated as the change in price divided by the change in quantity demanded.
Answer the following statement true (T) or false (F)
Two goods are substitutes if an increase in the price of one good leads to a decrease in demand for the other
Indicate whether the statement is true or false