Which of the following conditions must hold if a consumer is maximizing her utility?
A. MUX × PX = MUY × PY
B. MUX = MUY
C. MUX/PY = MUY/PX
D. MUX/PX = MUY/PY
D. MUX/PX = MUY/PY
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The above figure shows the marginal benefits and marginal costs of a college education. If a subsidy of $5,000 is paid to the colleges, then colleges charge tuition of
A) $0. B) $5,000. C) $10,000. D) $15,000.
One big difference between tariffs and quotas is that tariffs:
A. raise the price of a good while quotas lower it. B. generate tax revenues while quotas do not. C. stimulate international trade while quotas inhibit it. D. hurt domestic producers while quotas help them.
Refer to the above figure. Autonomous consumption equals
A. $5000. B. -$5000. C. 0. D. $25,000.
Firms have a harder time getting loans during periods of deflation because:
A. deflation aggravates information problems in ways dissimilar to inflation. B. deflation decreases the net worth of firms. C. for a firm seeking a loan, deflation increases the real amount of their liabilities without increasing the real value of their assets. D. all of the answers given are correct.