A local restaurant offers an "all you can eat" barbeque special. You pay $9.00, and then you can eat as many servings as you desire at no additional cost. It would follow that you will stop eating when
a. your marginal utility (or value) derived from eating another serving is zero.
b. your total utility (or value) derived from all of the servings consumed just equals $9.00.
c. your marginal utility (or value) derived from another serving equals $9.00.
d. it is physically impossible for you to eat any more.
A
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If real GDP grew by 5 percent during one year and population also grew by 5 percent, then
a. real GDP did not change. b. nominal GDP did not change. c. the change in real GDP equaled the change in nominal GDP. d. real GDP per capital did not change.
Which of the following would be most inelastic with regard to price?
a. a Samsung LCD television b. a Sony LCD television c. all LCD televisions d. Demand for all of the above would be equally elastic because none are necessities.
During the 1970s, countercyclical fiscal policy
a. to spur increases in real GDP failed b. worked better than predicted, curbing inflation while decreasing unemployment rates c. demonstrated that the economy could be fine-tuned using aggressive fiscal policy d. showed that the Keynesian assumption about the shape of the aggregate supply curve was basically correct e. failed to lower the unemployment rate and actually increased the inflation rate
A bushel of apples costs $15.00 in the U.S. The same apples cost 1,600 yen in Japan. If the exchange rate is 80 yen per dollar, is there a possibility for arbitrage? Explain and defend your answer. As part of your defense, find the real exchange rate