Suppose that your roommate comes back to the dormitory exclaiming about what a great deal she got on a new shirt that she would have purchased at the regular price for $35, but she bought on sale for $6. An appropriate response would be to
a. make an interpersonal comparison of utility and remark that the shirt is ugly and not worth even $6 to
you
b. suggest that your roommate is now enjoying $29 of consumer surplus
c. suggest that the shirt was on sale because it has a low marginal utility
d. suggest that your roommate's total utility from the shirt is 35 utils
e. suggest that your roommate's total utility from the shirt is at least $29
b. suggest that your roommate is now enjoying $29 of consumer surplus
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The United States usually exports ________ goods than it imports and exports ________ services than it imports
A) fewer; more B) more; fewer C) fewer; fewer D) more; more
At prices above a consumer’s reservation price:
A. the opportunity cost is less than the benefit from having the good. B. the opportunity cost is greater than the benefit from having the good. C. the buyer will purchase the good. D. the willingness to pay is greater than the price.
Why are total expenditures on a good maximized at the point on the demand curve where the price elasticity of demand equals -1? Explain your answer using the appropriate algebra.
What will be an ideal response?
Suppose Jeremy's marginal utility from attending his 10th San Antonio Spurs game was 50 and the marginal utility from attending his 1st Rihanna concert was 70. Assume that the price of a Spurs ticket is $30 and the price of a Rihanna ticket is $100. Which of the following would be TRUE?
A. Jeremy would not alter his behavior. B. Jeremy would attend more Spurs games and less Rihanna concerts. C. Jeremy would attend more Rihanna concerts and less Spurs games. D. Jeremy would attend less of both Spurs games and Rihanna concerts.