A consumer's optimum is found when
A) the marginal utility of the last dollar spent equals zero for each good.
B) the marginal utility of each good is increasing and the total income is spent.
C) the total utility of each good is the same and the total income is spent.
D) the marginal utility of the last dollar spent on each good is the same and all income is spent.
Answer: D
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Limited government licenses that create a monopoly do so because
A) the license generates a marginal cost advantage. B) the monopoly will become a natural monopoly. C) a barrier to enter the market exists. D) All of the above.
People in poor countries may have difficulties achieving economic growth because:
a. their production possibilities curves slope upward instead of downward. b. they must cut back on current consumption to increase capital goods. c. they have a solid consumption base already in place. d. their resource bases are fully developed. e. the law of increasing costs makes it hard to produce more goods.
The demand for a good would be more price inelastic
a. the shorter the time the consumer has to adjust to price changes b. the higher the price of the good c. the more the number of good substitutes d. the less essential the nature of the good e. if the supply is more price elastic
A recommended policy for DVCs to implement that promotes economic growth is:
A. Establishing realistic policies for exchange rates B. Obtaining more low-interest loans from the U.S. government C. Encouraging more tariffs and quotas to protect DVC businesses D. Discouraging direct foreign investment to make DVCs more self-sufficient