A consumer will achieve the highest level of utility possible when she consumes
A. at a point to the left of the budget constraint.
B. at the point at which the indifference curve crosses the budget constraint.
C. just below the point where the indifference curve crosses the budget constraint.
D. at the point at which the highest indifference curve is tangent to the budget constraint.
Answer: D
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Policy-oriented economists seek to develop theories to
A. explain how things work, so policies can be formulated. B. describe what happened in a particular time period in history. C. describe current economic events. D. find correlations between events. E. change people’s values and ethics.
Why is the profitability of firms under perfect competition different when they have non-identical cost structures in comparison to identical cost structures?
What will be an ideal response?
If the actual unemployment rate is less than the natural rate of unemployment, there will be a tendency toward:
a. increased inflation and a leftward shift of the short-run Phillips curve. b. decreased inflation and a rightward shift of the short-run Phillips curve. c. increased inflation and a rightward shift of the short-run Phillips curve. d. decreased inflation and a leftward shift of the short-run Phillips curve.
An "opportunity cost" may be described as:
a. the value of what must be gtiven up b. the opporrtunity foregone c. the value of the next best alternative d. the correct measure of cost e. all of these are correct