Author Question: Daniel enjoys both soda and pizza, allocating his purchases across these two goods so that his ... (Read 49 times)

RRMR · **on:** Jun 30, 2018

Daniel enjoys both soda and pizza, allocating his purchases across these two goods so that his utility is maximized. If Daniel receives one-third as much utility from the last can of soda as from the last slice of pizza, we can say that:
a. the price of pizza is one-third that of soda.
b. the price of pizza is equal to that of soda.
c. the price of pizza is twice that of soda.
d. the price of pizza is three times that of soda.

Question 2

The producer can raise the level of profit by hiring more units of a resource if:
a. the marginal revenue product of the resource is equal to the marginal factor cost.
b. the marginal factor cost becomes negative.
c. the marginal revenue product of the resource is greater than the marginal factor cost.
d. the marginal revenue product falls to zero.
e. the marginal revenue product of the resource is less than the marginal factor cost.