What is utility and how do we use the concept of utility to describe a consumer's preferences?
What will be an ideal response?
Utility is the benefit a person gets from the consumption of goods and services. We use total utility to describe a consumer's preferences by looking at the (total) utility from the consumption of all the goods and services. We use marginal utility to measure the gain in utility from consuming another unit of a good or service.
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A problem with third-party financing of so much of health care is that
A) it reduces the quality of health care received by most people. B) it discourages physicians from getting second opinions and running enough tests to be sure the right procedure is followed. C) it causes the demand for medical services to increase, which causes health care costs to increase. D) it discourages people from relying on the judgments of physicians in making decisions about health care.
A typical trend line drawn through a series of business cycles
a. is horizontal, indicating that the economy always returns to equilibrium b. is horizontal, indicating that economic phases offset each other c. is downward sloping, indicating that the unemployment rate decreases over time d. is upwards sloping, indicating that the unemployment rate decreases over time e. is upward sloping, indicating an annual rate of growth that is greater than zero