Using the utility-optimizing model, which of the following would induce a consumer to increase consumption of good A, a normal good?
A) an increase in the marginal utility of A
B) a decrease in the total utility of B
C) an increase in the marginal utility of good B
D) a decrease in income
Answer: A
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Why can a firm in monopolistic competition make an economic profit only in the short run?
What will be an ideal response?
Answer the following statements true (T) or false (F)
1. When there are two candidates on one side of the issues and one candidate on the other side of the issues, it can “split the vote” between supporters of the side with two candidates, handing the election to someone who does not have the support of the majority of voters. 2. A special interest group can pressure legislators to enact public policies that do not benefit society as a whole. 3. Special interests are more likely to arise from a group that is relatively anonymous, rather than from a group where there is already a lot of public scrutiny. 4. The median voter theory argues that politicians will try to match policies to what pleases the majority of voter preferences. 5. The theory of comparative advantage explains that the gains from international trade result from pursuing comparative advantage and producing at a lower opportunity cost.
Economists generally believe that, although there may be advantages to society from ticket-scalping, the costs to society of this activity outweigh the benefits
a. True b. False Indicate whether the statement is true or false
Based on information provided in the textbook, which of the following statements is true regarding taxing millionaires and the budget deficit in 2012?
A) If the government had taxed all income earners who earned more than $1 million a 100 percent income tax rate, the budget deficit would have been completely eliminated, and a budget surplus would have been incurred. B) If the government had taxed all income earners who earned more than $1 million a 50 percent income tax rate, the budget deficit would have been completely eliminated. C) If the government had taxed all income earners who earned more than $1 million a 100 percent income tax rate, the budget deficit would have fallen but not been completely eliminated. D) If the government had taxed all income earners who earned more than $1 million a 100 percent income tax rate, the budget would have been balanced.