Assume that an individual consumes only hotdogs and colas and that the last hotdog consumed yields 15 utils and the last cola 10 utils. If the price of a hotdog is $1 and the price of a cola is $.50, we can conclude that the:

A. consumer should consume more hotdogs and less cola.
B. price of hotdogs is too high.
C. consumer should consume fewer hotdogs and more cola.
D. consumer is in equilibrium.


Answer: C

Economics

You might also like to view...

If the supply of solar panels increases,

A) the price and quantity of solar panels increases. B) the demand for solar panels increases. C) the quantity demanded of solar panels decreases. D) the price of solar panels decreases and the quantity increases. E) None of the above.

Economics

Which of the following helps explain why depositors sometimes put their funds in demand deposits rather than NOW accounts?

A) Demand deposits pay interest, whereas NOW accounts do not pay interest. B) Businesses may not hold NOW accounts. C) Checks may be written against demand deposits, but not against NOW accounts. D) Demand deposits are more liquid than NOW accounts.

Economics

What can we say about APC + APS and MPC + MPS?

A) Each must sum to 1. B) MPC + MPS = 100% of total income. C) APC + APS = 100% of the change in income. D) MPC + MPS always equals 1, but the sum of APC + APS can vary.

Economics

During the second half of the 19th century, export demand for U.S. agricultural products

a. declined. b. increased. c. remained static. d. experienced chaotic periods on increase and decrease.

Economics