Author Question: In terms of utility theory, equilibrium in the real world means that a. households are consuming as ... (Read 225 times)

Mr. Wonderful

  • Hero Member
  • *****
  • Posts: 866
In terms of utility theory, equilibrium in the real world means that
 a. households are consuming as much of every commodity as they would like
  b. households have spent their incomes in such a way that their overall satisfaction is maximized
  c. households have spent their incomes in such a way that their marginal utility is maximized
  d. households have spent their incomes in such a way that their marginal utility is zero for every product consumed
  e. households have spent their incomes in such a way that their total utility is zero

Question 2

As long as scarcity exists,
 a. product prices play no role in utility maximization
  b. income plays no role in utility maximization
  c. income and product prices must both be considered in utility maximization
  d. consumers maximize utility by consuming all products until their marginal utility is zero
  e. product prices will be zero



alexanderhamilton

  • Sr. Member
  • ****
  • Posts: 334
Answer to Question 1

B

Answer to Question 2

C



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

All adverse reactions are commonly charted in red ink in the patient's record and usually are noted on the front of the chart. Failure to follow correct documentation procedures may result in malpractice lawsuits.

Did you know?

Vampire bats have a natural anticoagulant in their saliva that permits continuous bleeding after they painlessly open a wound with their incisors. This capillary blood does not cause any significant blood loss to their victims.

Did you know?

Alcohol acts as a diuretic. Eight ounces of water is needed to metabolize just 1 ounce of alcohol.

Did you know?

The toxic levels for lithium carbonate are close to the therapeutic levels. Signs of toxicity include fine hand tremor, polyuria, mild thirst, nausea, general discomfort, diarrhea, vomiting, drowsiness, muscular weakness, lack of coordination, ataxia, giddiness, tinnitus, and blurred vision.

Did you know?

An identified risk factor for osteoporosis is the intake of excessive amounts of vitamin A. Dietary intake of approximately double the recommended daily amount of vitamin A, by women, has been shown to reduce bone mineral density and increase the chances for hip fractures compared with women who consumed the recommended daily amount (or less) of vitamin A.

For a complete list of videos, visit our video library