If MUA/PA> MUB /PB, an individual should choose to consume more of good A.
Answer the following statement true (T) or false (F)
True
Since the marginal utility per dollar of A exceeds the marginal utility per dollar of B, the individual should choose to consume more of A.
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Because of a decrease in the wage rate it must pay, a perfectly competitive firm's marginal costs decrease but its demand curve stays the same. As a result, the firm
A) decreases the amount of output it produces and raises its price. B) increases the amount of output it produces and lowers it price. C) increases the amount of output it produces and does not change its price. D) decreases the amount of output it produces and lowers its price.
Even economists have no single, precise definition of money because
A) money supply statistics are a state secret. B) the Federal Reserve does not employ or report different measures of the money supply. C) the "moneyness" or liquidity of an asset is a matter of degree. D) economists find disagreement interesting and refuse to agree for ideological reasons.
The concept of "rational expectations" is consistent with the notion of
a. utility maximization. b. profit maximization. c. strong mechanisms towards equilibrium in markets d. auction markets. e. all of the above.
Use the indifference curves and the budget lines in Figure 19.3 to answer the indicated question. Assume the price of Y is $1 per unit. In Figure 19.3, point E
A. Is a high level of utility but not affordable. B. Is optimal and affordable. C. Gives the consumer a very high level of utility and is affordable. D. Represents a very low level of utility and is not desirable.