The elasticity formula solves the units problem because percentages are unaffected by the units of measure
a. True
b. False
Indicate whether the statement is true or false
True
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An increase in the prices of ________ goods is unlikely to put downward pressure on a currency's nominal exchange rate
A) parity B) nontradable C) identical D) relative
The demand schedule for a good
a. indicates the relationship between the price of the good and the price of other goods. b. indicates the quantities of the good that people will buy at various prices. c. illustrates the quantity producers will provide at alternative prices. d. is determined primarily by the cost of producing the good.
Diminishing marginal utility suggests that
a. more is always preferred to less. b. the well-being of society is maximized when the distribution of income is equal. c. the poor are less efficient at spending money than the rich. d. the poor receive more satisfaction from the last dollar spent than the rich.
The price of a piece of pizza is $1, and the price of a movie is $6. The consumer has purchased 2 pieces of pizza and 2 movies, and her marginal utility from the second piece of pizza is 20 and from the second movie is 120. The consumer has an income of
$21. This combination of goods A) maximizes utility and is an optimum because the marginal utility of the last dollar spent on each good is the same. B) maximizes utility because the marginal utility of the last dollar spent on each good is the same, but it is not an equilibrium because marginal utility is not zero. C) is not an optimum because the consumer has not spent all of her money. D) is not an optimum because the marginal utility of the last dollar spent on each good is not the same.