At Revolution Doughnuts in Fort Collins, Colorado, a cup of coffee or a doughnut is $1. Suppose Hannah loves going to Revolution Doughnuts
Currently, her marginal utility per dollar from doughnuts is 14 and her marginal utility per dollar from coffee is 10. Is Hannah maximizing her total utility? A) No, she needs to buy more doughnuts and less coffee.
B) No, she needs to buy more coffee and fewer doughnuts.
C) Yes, she is maximizing utility.
D) No, she needs to buy fewer doughnuts and less coffee.
A
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If depreciation is less than gross investment, then net investment is
A) positive. B) negative. C) zero. D) This situation could never occur because it is impossible for depreciation to be less than gross investment.
Depreciation represents
A. The consumption of capital in the production process. B. Wasted capital. C. Gross investment plus net investment. D. A loss of productive capability as a result of the inefficient use of resources.