Muhammad is choosing between two ride-sharing services. Ride-sharing service A estimates a wait time of 10 minutes and a total price of $8.00 for the ride to his destination, whereas ride-sharing service B estimates a wait time of only 4 minutes but a total price of $12.00. Assuming that service A generates 2 utils and service B generates 8 utils, which service should Muhammad rationally choose?
a. service A
b. service B
c. either service because both offer the same utility per dollar
d. neither service because both offer negative utility per dollar
b. service B
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Assuming all else equal, if the production technology available to a nation improves, its aggregate production function:
A) shifts inward. B) becomes vertical. C) shifts upward. D) becomes horizontal.
If the economy is experiencing an inflationary gap and the government wants to accelerate the adjustment to the long-run equilibrium, it should
A) reduce aggregate demand by cutting government spending or raising taxes. B) reduce aggregate demand by increasing government spending or cutting taxes. C) increase aggregate supply by cutting government spending or raising taxes. D) increase aggregate supply by increasing government spending or lowering taxes.
Utility is:
A. maximized by rational individuals. B. revealed by observing choices an individual makes. C. the satisfaction individuals get from different bundles of goods. D. All of these are true.
The World Bank defines extreme poverty as income of less than $1.90 per day per person.
Answer the following statement true (T) or false (F)