When you are hungry, you receive the most satisfaction from the first apple and less satisfaction from each additional apple. What explains this?

a. income effect
b. substitution effect
c. law of elasticity of demand
d. law of diminishing marginal utility

Ans: d. law of diminishing marginal utility

Economics

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Suppose a little girl likes peanut butter and jelly sandwiches with exactly 2T of jelly and 1T of peanut butter. Suppose further that her mom agrees to make sandwiches to those exact specifications and the price of peanut butter is $.25/T and the price of jelly is $.10/T. If she has $1.80 to spend on peanut butter and jelly ingredients (ignore the bread) in a week, how many sandwiches will she

make? a. 1 b. 2 c. 4 d. 8

Economics

An extra hour of market work is an attractive use of your time

a. because of the utility generated by goods made possible through the extra work b. solely because of the personal satisfaction it generates c. when the disutility of income generated by the extra work exceeds the utility d. when the net utility of the extra goods made possible and the extra work is greater than zero e. only when you do not enjoy leisure time

Economics