Which of the following would be most likely to cause an increase in current aggregate demand in the United States?
a. increased fear that the U.S. economy was going into a recession
b. an increase in the real interest rate
c. sharp increase in the value of stocks owned by Americans
d. a recession in Canada, Mexico, and Western Europe
C
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If Bob has one piece of gum in his mouth, he gains a utility of 12. If he adds a second piece to the first, it yields a marginal utility of 6; adding a third will bring marginal utility of 1. Adding a fourth piece will make Bob choke, yielding a marginal utility of 4. We can say:
A. Bob's total utility from chewing four pieces of gum would be 23. B. Bob's total utility will decrease if he chews the fourth piece of gum. C. Bob's total utility will be maximized if he eats two pieces. D. Bob's total utility decreases after the first piece of gum.
Producing more cabbage is efficient if
a. cabbage production can be increased without reducing production of other goods. b. the opportunity cost of more cabbage is less than its marginal utility. c. society values the additional cabbage more highly than the lettuce it must give up to produce the extra cabbage. d. All of the above are correct.
A profit-maximizing firm should employ a resource up to the point that:
a. marginal revenue product is zero. b. marginal revenue product equals marginal resource cost. c. marginal revenue product is maximized. d. marginal revenue equals marginal cost.
Economic losses are a signal to producers
A. That consumer demand is being satisfied. B. That they are not using resources in the best way. C. That consumers are content with the allocation of resources. D. That they are using resources in the most efficient way.