Which of the following most clearly illustrates the law of diminishing marginal utility?
a. The total satisfaction from consuming a good falls as more of the good is consumed.
b. Marginal utility falls as total utility falls.
c. The quantity of a good demanded falls as its price rises.
d. The additional satisfaction from consuming a good falls as more of the good is consumed.
e. There is a direct relationship between the price of a good and its total utility.
D
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Increasing the reserve requirement ratio is
A) a contractionary policy because it lowers the amount of total reserves in the banking system. B) a contractionary policy because it lowers the amount of excess reserves in the banking system. C) an expansionary policy because it raises the amount of excess reserves in the banking system. D) an expansionary policy because it raises the amount of required reserves in the banking system.
If a separating equilibrium is played in a signaling game, the receiver will "update" his beliefs during the game.
Answer the following statement true (T) or false (F)