Ann's money income is $250, the price of X is $3, and the price of Y is $2. Given these prices and income, Ann buys 60 units of X and 35 units of Y. Call this combination of X and Y bundle J. At bundle J Ann's MRS is 2. Given these prices and income, what is Ann's equilibrium consumption of X?
A. X = 60
B. X < 60
C. X > 60
D. None of the statements is correct.
Answer: C
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US and Canada can both grow wheat and can do mining. Use the following table to look for which country has a comparative advantage in mining. (HINT: Find the cost of mining in terms of wheat in each country.) Absolute Cost in US Absolute Cost in Canada Wheat $5 C$8 Mining $10 C$12
a. Canada has a comparative advantage in mining. b. The US has a comparative advantage in mining. c. No comparative advantage in mining exists for either nation. d. We must first know the exchange rate to be able to answer this question. e. Both a and b.
When comparing two alternatives X and Y, a consumer either prefers X to Y, prefers Y to X, or is indifferent between them. This property is called:
A. transitivity. B. completeness. C. the ranking principle. D. the choice principle.
If Health Spas charges an annual membership fee of $1,000 for the use of their facilities and charges a $20 fee each time a member uses their facilities, this is an example of ________.
A) a single pricing scheme B) two-part pricing C) commodity bundling D) an all-or-nothing offer
The foreign holdings of U.S. dollars
a. reduce the living standards of Americans. b. are not included in the M1 money supply. c. account for approximately half of all U.S. currency issued by the Fed. d. are hard to explain since the dollar is not legal tender outside the United States.