At any point on an indifference curve, the slope indicates:
A. the way the consumer's budget is allocated between the two goods.
B. the market rate of substitution between the two goods.
C. how the total satisfaction of the consumer changes with different market baskets.
D. None of the statements is correct.
Answer: D
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Which of the following is the primary source of rapid growth in the real earnings of workers?
a. strong unions b. government regulation of labor markets c. rapid growth in worker productivity d. increases in the minimum wage
Suppose a business firm dumps its used car batteries into a river.
A. The company's actions constitute an external cost. B. The company's actions constitute an external benefit. C. The company's actions would be an example of the market system efficiently allocating resources. D. The company's actions damage no one but itself.
The low rate of inflation in the 1990s is probably due to
A. the rise of discount stores that minimize distribution costs, thereby holding prices down. B. the fact that businesses have become meaner and leaner. C. the advent of E-commerce that increased competition and drove prices down. D. the flood of imported goods that increased competition with American-made goods. E. All of the choices are correct.
Inflation represents
A) an increase in output. B) an increase in the aggregate price level. C) an increase in the unemployment rate. D) a recession.