According to marginal utility theory, a rise in income will
A) increase a consumer's total utility.
B) increase consumption of all goods.
C) increase the marginal utility of all goods.
D) None of the above answers is correct.
A
You might also like to view...
Which of the following would lead you to predict an upward shift in the consumption function?
a. a decrease in the value of real wealth b. a decrease in disposable income c. an increase in the value of real wealth d. an increase in the price level
Supply-side economics stresses that high marginal tax rates
a. are the key to maintaining a balanced budget. b. are an effective short-run countercyclical tool to promote recovery from a recession. c. discourage people from working harder and using their resources productively. d. encourage people to work, supply resources, and use them more efficiently.