The law of diminishing marginal utility
a. is another way of expressing the law of demand
b. states that people's inclination to consume basic goods falls as incomes increase
c. shows that goods lose their individual values as the total utility of all goods decreases
d. is the utility equivalent to the law of increasing costs
e. states that total utility rises at a decreasing rate as consumption increases
e. states that total utility rises at a decreasing rate as consumption increases
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The law of demand concludes that a rise in the price of a golf ball ________ the quantity demanded and ________
A) increases; shifts the demand curve for golf balls rightward B) decreases; shifts the demand curve for golf balls leftward C) decreases; creates a movement up along the demand curve for golf balls D) increases; creates a movement down along the demand curve for golf balls
The following graph shows the production possibilities curve for the economy with only two members, Silvia and Art. Silvia can produce either 50 pounds of beef or 2 computers per week, and Art can produce 100 pounds of beef or 1 computer per week. Both of them work 40 weeks per year.
Art's opportunity cost of producing one computer is ________ pounds of beef.
A. 1/50 B. 50 C. 1/100 D. 100
In a dual economy with limited currency convertibility:
A. neither the traditional nor the international sector tends to be dollarized. B. only the traditional sector tends to be dollarized. C. only the international sector tends to be dollarized. D. both the traditional and international sectors tend to be dollarized.
Which of the following is an important advantage of discretionary monetary policy?
a. Influencing the political business cycle
b. Flexibility to deal with changing economic conditions
c. Limiting the opportunities for abuse of power by policymakers
d. Avoiding the time inconsistency of policy problem