In economic theory, the idea of the equimarginal principle, or consumer equilibrium, means:
a. consumers appear to be similar in their buying habits, which explains why prices are almost always in equilibrium.
b. to maximize utility, consumers allocate all of their incomes among goods so as to equate the total utility of all units of goods purchased.
c. to maximize utility, consumers must allocate their scarce incomes among only the cheapest products available.
d. to maximize utility, consumers must allocate their scarce incomes among goods so as to equate the marginal utilities per dollar of expenditure on the last unit of each good purchased.
e. the marginal utilities among luxury goods are always equal among certain high-income earners.
d
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When the price of candy bars decreased from $0.55 to $0.45, the quantity demanded changed from 19,000 per day to 21,000 per day. In this price range, the price elasticity of demand (based on the midpoint formula) is
A. -0.5. B. -0.2. C. -1. D. -2.
What most accurately describes the ratio of federal employment of the total labor force between 1910 and 2007?
a. Between 1930 and 1945 the federal labor force grew dramatically, but after World War II it shrank below pre-Depression levels. b. Since 1910, federal employment has increased consistently at the rate of about 3% per year. c. Between 1910 and 1950 federal employment dropped dramatically, but after 1950 it grew consistently. d. The share of federal employment in the total labor force peaked briefly above four percent during the Korean War, and then began a steady decline to about the same level as the 1930s.
If a bank purchases government securities rather than lends funds, the:
a. M2 money supply does not rise. b. M2 money supply rises, but not by as much as when the funds are lent. c. M2 money supply rises by more than would be the case if the funds were lent. d. M2 money supply rises by the same amount as if they were lent.
Which of the following is the situation in which firms outside a trade bloc shift the final assembling process of partially assembled products into a member nation of the bloc and then export the finished products to other nations within the bloc?
A. rules of origin B. trade retention C. trade diversion D. trade deflection