Meaning well, your grandmother gives you a new wool sweater for your birthday that she knitted herself. You, however, hate wearing wool. What is the utility problem that you face? What can you do to remedy the problem?
Please provide the best answer for the statement.
The problem you face is the fact that you would receive more utility if you received the cash value of the sweater your grandmother made instead of the sweater itself. Since you value the sweater less that what it cost your grandmother to make it, there is a value loss and a lower utility level if achieved.
You could work to fix or avoid that problem in a number of ways. First, you could give her a list of gifts you’d like for your birthday next year so that she’ll know what to get you. You could also recycle the gift and give it to someone who would like a wool sweater. If the sweater had come from a store, you could also return it to get something that you like better.
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In order to earn an economic profit, a firm needs to charge a price in excess of
A) accounting average cost. B) normal average costs. C) economic average cost. D) long-run fixed costs.
Based on the graph showing marginal cost pricing versus average cost pricing, the compromise created by average cost pricing is located at point ______.
a. A
b. B
c. C
d. D
Refer to the above table. What is the absolute price elasticity of demand when a price rises from $8 to $8.50?
A. 1.94 B. 5.15 C. 0.194 D. 0.515
Your allergies are bad this summer so your allergist writes you a prescription to relieve your symptoms. When you get to the pharmacy, you notice the name brand allergy medicine is more expensive than its generic equivalent. You purchase the generic equivalent and demonstrate all of the following EXCEPT
A. the principle of diminishing marginal utility. B. when price decreases, the quantity demanded increases. C. a price change may affect consumer optimum. D. the principle of substitution of one product for another.