The mix of consumer purchases that maximizes the utility attainable from available income is called the
A. Optimal consumption.
B. Total utility combination.
C. Maximum consumption.
D. Marginal utility combination.
Answer: A
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The free-rider problem arises if goods are
A. nonrivalrous in consumption. B. rivalrous in consumption. C. nonexcludable. D. excludable. E. a and d
Economists tend to be concerned about entry barriers. Why are entry barriers so important?
What will be an ideal response?
Which of the following statements best describes the role played by prices in a command economy such as the former Soviet Union?
A. Prices were used to allocate resources. B. Prices played the same role as in a market economy. C. Prices were used to ration final goods and services but not to allocate resources. D. Prices were not used at all.
You read online that, at current rates of production, the yearly world supply of food is sufficient to feed the projected 2050 population of earth, but that after 2050 there will be massive starvation. This prediction appears to assume that:
A. the long-run supply of food is perfectly elastic. B. the short-run supply of food is perfectly elastic. C. the long-run supply of food is perfectly inelastic. D. the short-run elasticity of supply of food is greater than long-run elasticity of supply.