The above figure shows Jane's budget line and two of her indifference curves. Jane's marginal rate of substitution is
A) the rate at which she would give up a lobster dinner for a steak dinner and consider herself just as well off.
B) equal to the ratio of the price of a steak dinner to the price of a lobster dinner when she is at her best affordable point.
C) equal to 2 lobster dinners per steak dinner at her best affordable point.
D) Both answers A and B are correct.
D
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If you deposit $1,000 into a savings account that pays you 5% interest per year, approximately how long will it take to double your money?
a. 8 years b. 10 years c. 12 years d. 14 years
Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower