« previous next »

Author Question: If a firm produces a given amount of output using the least amount of inputs, it definitely achieves ... (Read 128 times)

fahad

  • Hero Member
  • *****
  • Posts: 570
on: Jun 29, 2018
If a firm produces a given amount of output using the least amount of inputs, it definitely achieves economic efficiency.
 
  Indicate whether the statement is true or false

Question 2

Ricardo likes to rent DVDs and attend concerts. The DVDs cost 4 and the concerts cost 40. Ricardo's marginal utility from the last DVD is 20 units. Ricardo is maximizing his utility. What is his marginal utility from the last concert he attended?
 
  What will be an ideal response?


kalskdjl1212

  • Sr. Member
  • ****
  • Posts: 353
Reply #1 on: Jun 29, 2018
Answer to Question 1

FALSE

Answer to Question 2

The marginal utility from his last concert is 200 units. In order for Ricardo to maximize his utility, the marginal utility per dollar must be equal for all goods. The marginal utility per dollar from the last DVD is (20 units)  (4 ) = 5. So the marginal utility per dollar from the last concert also must equal 5, which, given its price of 40, means that concert has a marginal utility of 200, because (200 units)  (40 ) = 5.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Stevens-Johnson syndrome and Toxic Epidermal Necrolysis syndrome are life-threatening reactions that can result in death. Complications include permanent blindness, dry-eye syndrome, lung damage, photophobia, asthma, chronic obstructive pulmonary disease, permanent loss of nail beds, scarring of mucous membranes, arthritis, and chronic fatigue syndrome. Many patients' pores scar shut, causing them to retain heat.

Did you know?

About 60% of newborn infants in the United States are jaundiced; that is, they look yellow. Kernicterus is a form of brain damage caused by excessive jaundice. When babies begin to be affected by excessive jaundice and begin to have brain damage, they become excessively lethargic.

Did you know?

Bisphosphonates were first developed in the nineteenth century. They were first investigated for use in disorders of bone metabolism in the 1960s. They are now used clinically for the treatment of osteoporosis, Paget's disease, bone metastasis, multiple myeloma, and other conditions that feature bone fragility.

Did you know?

There are over 65,000 known species of protozoa. About 10,000 species are parasitic.

Did you know?

During pregnancy, a woman is more likely to experience bleeding gums and nosebleeds caused by hormonal changes that increase blood flow to the mouth and nose.

The major cortical input and output pathways of the dorsolateral prefrontal association cortex. ... The major cortical input and output pathways of the dorsolateral prefrontal association cortex. ...
The relationship of substrate con- version (as measured by optical density) to the amount of patient ... The relationship of substrate con- version (as measured by optical density) to the amount of patient ...
Firm handshake Firm handshake
Preload is related to the amount of blood and stretching of the ventricular myocardial fibers Preload is related to the amount of blood and stretching of the ventricular myocardial fibers
During a period of high power demand, the voltage output of the power company is reduced by ... During a period of high power demand, the voltage output of the power company is reduced by ...
Summary of the inputs and outputs of photosynthesis. Summary of the inputs and outputs of photosynthesis.
Video: Structures that affect circulation - kidneys, blood volume and venous tone

For a complete list of videos, visit our video library