Bill uses his entire budget to purchase Pepsi and hamburgers, and he currently purchases no Pepsi and 6 hamburgers per week
The price of Pepsi is $1 per can, the price of a hamburger is $2, Bill's marginal utility from Pepsi is 2, and his marginal utility from hamburgers is 6. Is Bill's current consumption decision optimal? A) No, he should increase Pepsi consumption and reduce hamburger consumption.
B) No, he should purchase more of both goods.
C) Yes, the corner solution is best because his MRS is less than the price ratio.
D) We do not have enough information to answer this question.
C
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A) quantity of money and the monetary base will decrease. B) monetary base will decrease. C) quantity of money will increase. D) quantity of money will not change. E) quantity of money will decrease.
Why are Federal Reserve Notes (U.S. dollar bills) money in the U.S? Because
A) they are backed by gold. B) they are used as a general medium of exchange. C) they are created by the government. D) they would otherwise be useless. E) of all the above reasons.
A decrease in U.S. interest rates will, other things equal, tend to: a. lower the foreign exchange value of the dollar. b. help U.S. exporters
c. cause a net outflow of capital from the U.S. d. do all of the above.
In the long run, an entrepreneur who owns a perfectly competitive firm will earn an income just equal to what she could earn in the next best alternative use of her time
a. True b. False