The absolute value of the marginal rate of substitution is a measure of
A. the slope of a budget constraint.
B. the relative price of two goods.
C. income effect of a price change.
D. the slope of an indifference curve.
Answer: D
You might also like to view...
A real interest rate that causes the quantity of saving supplied to be equal to the quantity of saving (or investment) demanded is an example of the:
A. principle of comparative advantage. B. equilibrium principle. C. principle of increasing opportunity cost. D. scarcity principle.
Given the reserve-holding ratio e and the fraction of deposits held as cash c, the money multiplier becomes
A) ec/(e - c). B) (1 + c)/(e + c). C) (1 - c)/ec. D) 1 - e - c. E) ec - (1/c).
The Kansas-Nebraska Act of 1854 did not allow popular sovereignty over the issue of slavery
Indicate whether the statement is true or false
If income decreases by 20% and, in response, the quantity of housing demanded decreases by 14%, then the income elasticity of demand for housing is
A. -1. B. 1.43. C. -0.7. D. 0.7.