Crackerjacks cost twice as much as Doritos. Fred maximizes utility by buying eight boxes of Crackerjacks and some number of bags of Doritos. If the last box of Crackerjacks gives Fred 100 units of utility, you can conclude that:
A. the marginal utility of the last bag of Doritos Fred bought is 50 units.
B. Fred has also bought four bags of Doritos.
C. the total utility of the bags of Doritos Fred bought is 200 units.
D. Fred has also bought 16 bags of Doritos.
Answer: A
You might also like to view...
The key factors in raising standards of living in low-income countries have been increases in
A) capital accumulation and the money supply. B) income and government ownership of resources. C) foreign aid and population. D) technology and knowledge.
What is one benefit likely to result from population growth?
a. more efficient production unit sizes b. greater economic growth per capita c. a more educated workforce d. better property protection
When the marginal propensity to consume foreign imports (MPCF) rises, ceteris paribus, what happens to the trade balance?
a. It increases. b. It decreases. c. It depends on what happens to the MPC of domestic goods. d. It will not change.
Briefly explain the benefits of a flat tax.
What will be an ideal response?