The magnitude of the slope of the budget line
A) is defined as marginal rate of substitution.
B) equals the relative price of the good measured along the horizontal axis.
C) increases when income increases.
D) decreases when income increases.
B
You might also like to view...
If factors of production cannot flow between countries
A) there is no reason to expect that wages should be equal worldwide. B) multinational corporations would not exist. C) trade in goods could still occur. D) All of the above.
Larger countries tend to be more globalized, because their large internal markets allow them to export a wide range of products
a. True b. False Indicate whether the statement is true or false
A cartel produces output at a point where marginal revenue is equal to marginal cost for the industry in order to ______.
a. fix prices below total costs b. cheat on a cartel agreement c. maximize joint output d. maximize joint profit
Refer to Scenario 13.1 below to answer the question(s) that follow. SCENARIO 13.1: The government of Catalina Island is currently inviting investors to bid for the exclusive right to provide cable television service to its residents. The market demand for this service is P = 55 - 0.01Q, where Q is the number of households that would subscribe to the cable service and P is the monthly fee charged to the subscribers. The associated marginal revenue curve is MR = 55 - 0.02Q. Universal Entertainment is interested in bidding for the right to provide cable service on Catalina Island. It has a constant average and marginal cost of $15 for providing cable service to each household.Refer to Scenario 13.1. If Universal Entertainment were to be awarded the exclusive right to provide cable
service on Catalina Island, what price would it charge per household per month? A. $15.00 B. $27.50 C. $35.00 D. $55.00