The point where the indifference curve is tangent to the budget line
A) is the best affordable point.
B) is where the marginal rate of substitution exceeds the relative price by as much as possible.
C) is a point on consumer's demand curve.
D) All of the above answers are correct.
A
You might also like to view...
When technology advances, supply
A) increases, which is represented by a leftward shift in the supply curve. B) increases, which is represented by a rightward shift in the supply curve. C) decreases, which is represented by a rightward shift in the supply curve. D) decreases, which is represented by a leftward shift in the supply curve. E) remains the same; only quantity supplied changes.
In the mid-1980s, the salaries of accounting professors with Ph.D.s increased dramatically. This resulted in an increase in enrollments in Ph.D. accounting programs. Since a Ph.D
degree in accounting may take at least four years to complete, the short-run elasticity of supply of accounting professors is A) greater than the long-run-elasticity of supply. B) less than the long-run elasticity of supply. C) equal to the long-run elasticity of supply. D) equal to the short-run elasticity of demand.