The total utility of water is
A) lower than the total and marginal utility of diamonds.
B) lower than the total utility of diamonds, but the marginal utility is higher.
C) higher than the total utility of diamonds, but the marginal utility of diamonds is higher.
D) the same as the total utility of diamonds, but the marginal utilities are the same.
Answer: C
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Monetarists directly study the link between money and economic activity using
A) structural models. B) reduced-form models. C) scientific models. D) experimental models.
During the financial crisis, which type of risk was the biggest problem faced by investment banks?
A) interest-rate risk B) currency risk C) hedging risk D) credit risk
Suppose that in a month the price of a cup of coffee increases from $1 to $1.50. At the same time, the quantity of cups of coffee demanded decreases from 200 to 190. The price elasticity of demand for cups of coffee (calculated using the midpoint formula) is:
A. zero. B. inelastic. C. unit elastic. D. elastic.
Factors of production such as labor and capital
A. are complementary. B. can be complements and also substitutes. C. can be neither complements nor substitutes. D. are substitutable.