"Consumption possibilities are limited by total utility." True or false? Explain
Indicate whether the statement is true or false
False. Consumption possibilities are limit by the consumers' income and by the prices of goods and services they buy. Total utility does not limit consumption, it is a measure of total benefit that consumers get from consumption of goods and services.
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If point A on an indifference curve lies higher (measured vertically) than point B on the same curve, Point A automatically represents higher total utility than point B.
Answer the following statement true (T) or false (F)
The federal government's major outlay in its budget is_______ and its major source of revenue is _______
A. debt interest; sales of government bonds B. expenditure on goods and services; taxes on goods and services C. Social Security and other benefits; personal income taxes D. subsidies to farmers; corporate taxes
In the 2-factor, 2 good Heckscher-Ohlin model, an influx of workers from across the border would
A) move the point of production along the production possibility curve. B) shift the production possibility curve outward, and increase the production of both goods. C) shift the production possibility curve outward and decrease the production of the labor-intensive product. D) shift the production possibility curve outward and decrease the production of the capital-intensive product. E) shift the possibility curve outward and displace preexisting labor.
Refer to the figure below. The deadweight loss at the market equilibrium quantity is equal to the area ________.
A. ½ × EF × AC B. ½ × FG × BD C. ½ × GH × BD D. ½ × FG × AC