Fernando allocates his lunch money between pizza and Coke. A Coke has a price of $1 and a slice of pizza has a price of $1.50 . The marginal utility of the last slice of pizza Fernando ate today was 30, and the marginal utility of his last Coke was 25 . Fernando spent all of his lunch money. From this information we can conclude that
a. Fernando allocated his money in a way that maximized his total utility
b. Fernando's total utility would have been greater if he had purchased more Coke and less pizza
c. Fernando's total utility would have been greater if he had purchased more pizza and less Coke
d. Fernando could have increased his total utility by purchasing more Coke but the same quantity of pizza
e. Fernando could have increased his total utility by purchasing more pizza but the same quantity of Coke
B
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Productivity is generally measured as:
A. output per worker. B. nominal output over time. C. real output over time. D. output per year.
In the benchmark competitive case, the firm will expand the hiring of employees until the marginal revenue product is
A. equal to the market wage rate. B. greater than the market wage rate. C. the square of the market wage rate. D. less than the market wage rate.
Why do firms spend money on costly innovation?
A. Competitive markets leave firms no choice but to innovate. B. Innovation is a low-risk activity. C. Innovation always results in higher profits for firms. D. Innovation is usually profitable because the majority of innovations reach the market place. E. Because innovation is beneficial for society and firms are motivated to act in ways that are beneficial for society.
A nation's technological gains have increased labor productivity and, as a result, the average number of hours worked each week has been falling. How do Gross Domestic Product (GDP) calculations account for this shortening of the average workweek?
A. Gains in leisure time are dollar-valued and included in real per capita Gross Domestic Product (GDP) gains. B. Gains in leisure time are not included in Gross Domestic Product (GDP), so any increase in real per capita Gross Domestic Product (GDP) will understate the nation's actual economic growth. C. Neither real Gross Domestic Product (GDP) nor per capita real Gross Domestic Product (GDP) includes the increase in leisure time that results, so the nation's actual economic growth will be overstated. D. Real Gross Domestic Product (GDP) does not factor in an increase in leisure time but per capita real Gross Domestic Product (GDP) does.