Which of the following statements is correct?
i. The demand curve shows the maximum price people are willing to pay for a given quantity of the good.
ii. The maximum price a consumer is willing to pay for an additional unit is the marginal benefit of that unit.
iii. Value is what a consumer receives and price is what a consumer pays.
A) i only
B) ii only
C) iii only
D) i and iii
E) i, ii, and iii
E
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Explain how the following factors will shift the supply curve for sparkling wine:
a. New irrigation technology improves the average yield of a vineyard. b. Following an increase in the immigration of unskilled labor, the wages of wine-grape pickers fall. c. The government sets a minimum wage for seasonal employment.
If P = domestic prices, P* = foreign prices, and e is the nominal exchange rate, which of the following is implied by purchasing-power parity?
a. P = e/P b. 1 = e/P c. e = P/P d. None of the above is correct.