Refer to Figure 10-4. What is the marginal rate of substitution for one bar of chocolate between h and j?
A) of a cookie. B) of a cookie. C) 2 cookies. D) 4 cookies.
B
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Rent seeking is one reason why countries choose to
A) restrict trade. B) export and import the same goods. C) work for freer trade. D) follow the theory of comparative advantage.
Suppose milk and cereal are compliments and the demand for milk is Qdm = 40 - 6Pm - 2Pc, where Qdm stands for millions of gallons of milk demanded, Pm stands for the price of milk and Pc stands for the price of cereal. The supply of milk is Qsm = 6Pm - 8, where Qsm stands for millions of gallons of milk supplied. The demand and supply of cereal are Qdc = 90 - 5Pc - Pm and Qsc = 5Pc - 10, respectively, where Qdc stands for millions of boxes of cereal demanded and Qsc stands for millions of boxes of cereal supplied. Suppose the government imposes a $2.00 per gallon tax on milk. In the new general equilibrium:
A. consumers purchase more milk and more cereal. B. consumers purchase less milk and less cereal. C. consumers purchase more milk and less cereal. D. consumers purchase less milk and more cereal.
If the MPC = 3/4, an increase in government purchases of $40 billion will ultimately lead to:
a. a $160 billion increase in aggregate demand. b. a $40 billion increase in aggregate demand. c. a $30 billion increase in aggregate demand. d. a $30 billion decrease in aggregate demand.
The difference between accounting profit and economic profit is
a. explicit costs. b. implicit costs. c. total revenue. d. marginal product.