Suppose you solve a utility maximization problem, and the solution value of the Lagrange multiplier equals zero. What does this outcome imply about the problem solution?
A) You must have made an error while solving the problem.
B) The budget constraint is not binding, and the constrained solution is equal to the solution to the unconstrained utility maximization problem.
C) The optimal utility level for the consumer equals zero.
D) The consumer's demand curve is upward sloping.
B
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A rent control is an example of a ________
A) price floor B) price ceiling C) negative externality D) positive externality
The slowdown in U.S. economic growth in the period 1974-95 was primarily caused by ________
A) falling labor growth B) falling capital growth C) falling productivity growth D) none of the above
Joey cuts grass during the summer. He rents a lawn mower from his dad. Which of the following statements best illustrates the difference between the short run and the long run for Joey?
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Suppose a graph is drawn to show a consumer's preferences for football tickets and basketball tickets. The quantity of football tickets is measured on the horizontal axis
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