A utility-maximizing consumer is currently spending all of his/her income on two products, A and B. The MU of the last unit of A consumed is 50, the price of A is $25, and the price of B is $10 . The MU of the last unit of B consumed is
a. 50
b. 5
c. 2
d. 20
e. 100
D
You might also like to view...
All of the following might create problems from financial liberalization in emerging countries EXCEPT
A) ineffective screening of borrowers. B) limits on risk-taking. C) lax government supervision of banks. D) lenders failure to monitor borrowers.
In the balance of payments, the buying and selling of real and financial assets is represented in
A) current account. B) capital account. C) labor account. D) official reserve transactions account.
If aggregate demand changes when aggregate supply is stable, then the Phillips curve is negatively sloped.
Answer the following statement true (T) or false (F)
Research on productivity shocks has shown that
A. there have been no identifiable productivity shocks in the U.S. economy since World War II. B. large productivity shocks produce only small deviations in aggregate output. C. productivity shocks have only nominal effects. D. small productivity shocks can explain large business cycle fluctuations.