Joe consumes pizza and movies. He is currently spending his entire income and his marginal utility of pizza is 15 and his marginal utility of movies is 10
If the price of a pizza is $10 and the price of a movie is $5, then to maximize his utility Joe should A) increase consumption of pizza and decrease consumption of movies.
B) increase consumption of movies and decrease consumption of pizza.
C) not change his current bundle of movies and pizza.
D) increase consumption of both goods.
B
You might also like to view...
Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary B. B; no output C. B; expansionary D. A; a recessionary
Which of the following would not be classified as a capital expenditure for decision-making purposes?
a. purchase of a building b. investment in a new milling machine c. purchase of 90-day Treasury Bills d. investment in a management training program e. all of the above are capital expenditures
Lorenz curves supposedly reflect the disparities of standards of living among people living in a society but they cannot take into account factors that can greatly affect the disparities. Among them are all the following except
a. the size of population b. the availability of public housing and housing subsidies c. national health care systems d. national education systems e. social security programs
The more money firms spend on R&D the faster the economy is expected to grow.
Answer the following statement true (T) or false (F)