Have you ever gone to an auction? You see people bidding against each other for a good, such as an oil painting. As the bidding price inches upward, people drop out of the bidding process. Why? Because for the people dropping out, the
a. ratio of marginal utility to price of the good increases beyond the ratio of other goods
b. marginal utility per dollar of the good increases beyond the marginal utility per dollar of other goods
c. marginal utility per dollar of the good decreases below the marginal utility per dollar of other goods
d. marginal utility of the good falls to zero
e. ratio of marginal utility to price of the good falls to zero
C
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As a result of U.S. tariffs on fishnets produced in other nations, the quantity of fishnets purchased in the United States has
A) fallen to zero. B) not been affected. C) increased. D) decreased but not to zero. E) probably changed but whether it has increased or decreased is ambiguous.
If the dollar appreciates against the Mexican peso,
A) U.S. exports to Mexico become less expensive. B) U.S. exports to Mexico become more expensive. C) Mexican imports to the U.S. become more expensive. D) The value of Mexican imports to the United States does not change.