Assuming that good "x" is measured on the x-axis and good "y" is measured on the y-axis, if the utility for the two goods "x" and "y" can be measured as U = y, then it can be concluded that
A) "x" and "y" are perfect complements.
B) "x" is a "bad".
C) the indifference curves on the x,y graph are upward sloping.
D) the indifference curves on the x,y graph are horizontal.
D
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Total fixed cost is the sum of all
A) costs of the firm's fixed factors of production. B) costs associated with the production of goods. C) costs that rise as output increases. D) the marginal costs of the different factors of production.
When the government bans a good:
A. it makes acquiring that good illegal. B. the cost of breaking the ban changes the trade-offs consumers face. C. it is attempting to solve the nonexcludability problem. D. All of these statements are true.
The CPI is a measure of the
a. average change in the output of the goods and services purchased by a typical urban consumer. b. average prices of all goods and services produced. c. percentage change in the price level. d. average prices paid by consumers for a fixed basket of goods and services. e. average prices of all goods.
Your boss, the mayor of a city, thought that she'd come up with a great way to raise city revenue: increase the tax on gasoline in the city! However, she discovered that the city was actually receiving less tax revenue after the gas tax increase than before. Incensed, she declared that the economic policy prescription of taxing goods with inelastic demand must be flawed. Comment on her conclusion.
What will be an ideal response?