If the utility function (U) between food (F) and clothing (C) can be represented as U = , the marginal utility of food
A) is not positive.
B) does not diminish as food increases.
C) is not affected by the amount clothing.
D) increases as one obtains more clothing.
D
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The increasing cost in the law of increasing cost is a(n) ____________ cost.
A. average B. fixed C. opportunity D. declining
When the price of apples is $3 per bushel, and the quantity demanded is 1,000 bushels,
A) consumers need 1,000 bushels. B) consumers plan to purchase a total of 1,000 bushels. C) both A and B are true. D) none of the above is true.
A recessionary gap is defined as
a. an economy that is operating above its full-employment capacity b. an economy that is operating at full-employment capacity c. the amount by which aggregate expenditure exceeds the aggregate expenditure level needed to generate equilibrium national income at full employment without inflation d. the amount by which aggregate expenditure falls short of the level needed to generate equilibrium national income at full employment without inflation e. the path an economy takes out of a depression
When the Fed purchases government securities, it
a. increases banks' reserves and makes possible an increase in the money supply b. decreases banks' reserves and makes possible a decrease in the money supply c. automatically raises the discount rate d. uses discounting operations to influence margin requirements e. sends a signal to the banking community that there is too much inflation