At the utility maximizing equilibrium for two goods, X and Y, which of the following must be TRUE?
A) The marginal utility per dollar spent on X will exceed the marginal utility per dollar spent on Y.
B) The total expenditure will be the same for each good.
C) The marginal utility per dollar from X equals the marginal utility per dollar from Y.
D) The marginal utility will be the same for each good.
C
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At the unique point of consumer equilibrium, the:
a. distance between indifference curves is maximum. b. distance between the budget line and the indifference curve is maximum. c. marginal utility ratio of the two goods is equal. d. marginal rate of substitution (MRS) equals the slope of the budget line.
The SRAS curve is vertical at the natural level of real output
a. True b. False Indicate whether the statement is true or false
The Big Mac Index perfectly explains the relative size of economies.
a. true b. false
Melanie and Oli are competing Pacific halibut fishers. Both have been allocated ITQs that limit their catch to 1,000 tons of Pacific halibut each. Melanie's cost per ton is $20; Oli's cost per ton is $28. Refer to the information given. If the
market price of Pacific halibut is $40 per ton, what is the maximum amount Melanie would be willing to pay per ton for Oli's ITQs? A. $20. B. $28. C. $40. D. $12.