Owen and Simon both like playing with balls and cars. Suppose B represents the number of balls, and C represents the number of cars. If Owen's utility function can be given by U(B, C) = 10B + 5C, and Simon's utility function can be given by U(B, C) = 6B + 6C, which of the following trades would be mutually beneficial?
A. Owen gives Simon 3 cars in exchange for 2 balls
B. Owen gives Simon 2 cars in exchange for 3 balls
C. Owen gives Simon 3 balls in exchange for 2 cars
D. Owen gives Simon 2 balls in exchange for 3 cars
A. Owen gives Simon 3 cars in exchange for 2 balls
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Price discrimination refers to:
a. charging different prices to different groups on the basis of production cost differences. b. charging different prices to different groups without a basis for doing so because of differences in production costs. c. the ability of a firm to charge a price in excess of marginal cost. d. consumer bargain hunting.
The money multiplier tends to be greater when
A) individuals hold less cash. B) individuals hold more cash. C) the reserve ratio increases. D) banks hold more excess reserves.