Jeffrey spends all of his income on warm-up suits and running shoes, and the price of a warm-up suit is four times the price per pair of shoes. Then, in order to maximize total utility, Jeffrey should
a. buy four times as many warm-up suits as pairs of running shoes
b. buy four times as many pairs of running shoes as warm-up suits
c. divide his income equally between warm-up suits and running shoes
d. buy both items until the marginal utility of a warm-up suit is four times the marginal utility of a pair of running shoes
e. buy both items until the marginal utility of a pair of running shoes is four times the marginal utility of a warm-up suit
D
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The Gallatin Plan (1808)
(a) was a plan by the U.S. Senate for a comprehensive system of internal land and water transport in the eastern part of the country to be built by the federal government. (b) was promoted on the basis that only the federal government could command sufficient resources to build a transportation system. (c) was partially implemented but not completed by the federal government because of concerns about the constitutionality of such federal action. (d) was characterized by all of the above.
Johnny spends his day doing a variety of activities; he spends the morning exercising and doing yard work, reads in the afternoon, and hosts a dinner party in the evening. Economists would say his choice to do a variety of activities instead of spending all of his time on one activity illustrates the concept of:
A. tastes and preferences B. budget constraints C. diminishing marginal utility D. income effect
The difference between a nation’s value of its exports and imports is called the balance of _________.
a. trade b. payments c. goods d. shipments
When a person receives an increase in wealth, what is likely to happen to consumption and saving?
A. Consumption decreases and saving decreases. B. Consumption decreases and saving increases. C. Consumption increases and saving increases. D. Consumption increases and saving decreases.