Suppose a consumer has an income of $16, the price of A is $2, and the price of B is $1. Which of the following combinations is on the consumer's budget line?
A. 4A and 9B
B. 5A and 6B
C. 6A and 6B
D. 3A and 8B
B. 5A and 6B
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If a price ceiling of $1.50 per gallon is imposed on gasoline, and the market equilibrium price is $2, then the price ceiling is a binding constraint on the market
a. True b. False Indicate whether the statement is true or false
Answer the following statement(s) true (T) or false (F)
1. To know if the addition of a worker will add to a firm’s profits you must know both the marginal revenue product and the marginal resource cost. 2. Marginal revenue product is calculated by multiplying the marginal product times the marginal resource cost. 3. The equilibrium wage (W*) is the median cost of labor, with half of the workers making more and half making less. 4. The substitution effect describes the tendency of workers at a low wage rate to have a high rate of absenteeism. 5. If the substitution effect is stronger than the income effect, the individual’s labor supply curve is backward bending.
If a monopolist pays a lobbyist to protect its government-created monopoly, which of the following will happen?
a. Monopoly profits will increase. b. Consumers will have more surplus. c. Monopoly profits will decrease. d. Society will have less deadweight loss.
The Governors of the Federal Reserve System serve terms of:
A. four years, the same as the U.S. President, and the terms are not renewable. B. seven years. C. fourteen years. D. four years that can be renewed.