If a consumer consumes two goods, X and Y, and has indifference curves that are bowed inward, the consumer's optional choice occurs when
a. he consumes the maximum affordable quantity of good X.
b. he consumes the maximum affordable quantity of good Y.
c. his indifference curve is tangent to his budget constraint.
d. his indifference curve lies entirely above his budget constraint.
c
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To the options buyer, the premium paid for the contract represents the
A) maximum return. B) largest potential loss. C) yield. D) transaction cost.
The argument that ________ receives strong support from the innovative policy response to the recent financial crisis
A) rules can be too rigid B) discretionary policies are vulnerable to the time-inconsistency problem C) money is the sole source of fluctuations in aggregate demand D) changes in policies can change the coefficients in macroeconometric models
Sandy's uncompensated demand for candy is given by the equation Q = 15/p, where Q is the quantity of candy and p is the price. When the price of candy rises from $1 to $3, the change in consumer surplus is
A) $16.5. B) -$20. C) -$15. D) $15.
A monopsonist wants to purchase more labor. Which of the following statements is TRUE?
A) The wage rate that the monopsonist has to pay future workers is lower than it pays current workers since there is no other place to work. B) The wage rate that the monopsonist has to pay future workers will be the same rate it pays current workers. C) The wage rate that the monopsonist has to pay future workers is higher than what it will continue to pay current workers. D) The monopsonist will have to raise the wage rate for current and additional employees.