Joe the Economist tells his wife, Jane, that he wants to spend a weekend fishing with his friends. She replies, "You don't love me anymore." Just before she hits Joe with a croquet mallet, Joe explains to her that she has confused the concepts of
a. marginal utility and price
b. income and price
c. marginal utility and total utility
d. love and death
e. consumer surplus and utility
C
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Figure 5-13
In Figure 5-13, the line AB is
A. an indifference curve. B. a budget line. C. a marginal utility curve. D. a demand curve.
In a "liquidity trap,"
A) the demand for money is infinite. B) the LM curve is a vertical line. C) the nominal interest rate on short-term assets is relatively high. D) money supply changes have a strong impact on interest rates.
The term "business fluctuations" refers to
A) changes in overall business activity, as evidenced by changes in national income, employment, and the price level. B) changes in the general price level from inflation to deflation, or vice versa. C) changes in the full employment level of economic activity. D) changes in the value of the dollar.
Which of the following statements is correct about the roles of economists?
a. Economists are best viewed as policy advisers. b. Economists are best viewed as scientists. c. In trying to explain the world, economists are policy advisers; in trying to improve the world, they are scientists. d. In trying to explain the world, economists are scientists; in trying to improve the world, they are policy advisers.