A consumer buys only food and clothing. If the quantity of food bought increases while that of clothing remains the same, the marginal utility of food will:
A. fall, but not as fast as the marginal utility of clothing falls.
B. rise, but not as fast as the marginal utility of clothing rises.
C. rise relative to the marginal utility of clothing.
D. fall relative to the marginal utility of clothing.
Answer: D
You might also like to view...
Which statement is true?
A. A firm will operate in the short run if total revenue is greater than variable costs. B. A firm will shut down if variable costs are greater than total revenue. C. A firm is operating at peak efficiency if its average total cost is held to a minimum. D. All of the statements are true.
Holding other factors constant, if new technology becomes available that allows machines to produce manufactured goods more quickly and with fewer defects, then the real interest rate will ________ and the equilibrium quantity of national saving and investment will ________.
A. increase; not change B. decrease; increase C. increase; increase D. increase; decrease
Consider a labor market in equilibrium. If the demand curve shifts to the right while the supply curve shifts to the left, then the wage rate in the market will:
A. increase. B. decrease. C. remain unchanged. D. either increase or decrease or remain unchanged.
When a price ceiling below the equilibrium price is imposed on a good, production of the good
A) increases. B) decreases. C) does not change. D) is frozen at the pre-ceiling level. E) either increases or decreases depending on whether the supply of the good increases or decreases when the price ceiling is imposed.