Basket of goods A is on an indifference curve that lies closer to the origin than basket B. From this we know that
A) the prices of the goods in A are less than the prices of the goods in B.
B) the satisfaction from consuming A is more than the satisfaction from consuming B.
C) the marginal utility from consuming A is less than the marginal utility from consuming B.
D) the satisfaction from consuming A is less than the satisfaction from consuming B.
Answer: D
You might also like to view...
If an economy has to sacrifice increasing amounts of good X for each additional unit of good Y produced, then its production possibilities curve is:
A) bowed out from the origin. B) bowed in toward the origin. C) a straight line. D) a vertical line.
A vocal minority of economists, believers in the theory of rational expectations, insist that
a. the Phillips curve is downward sloping even in the short run. b. the Phillips curve is vertical even in the short run. c. a trade-off exists between inflation and unemployment even in the long run. d. expansionary fiscal and monetary policy can reduce unemployment without creating inflation.