While eating at Alex's "Pizza by the Slice" restaurant, Kara experiences diminishing marginal utility. She gained 10 units of satisfaction from her first slice of pizza consumed and would only receive 5 units of satisfaction from consuming a second
slice, at the same price. Based on this information we can conclude that:
A. Alex may have to lower the price to convince Kara to buy a second slice.
B. Kara will not eat a second slice, even if it is given to her at no charge.
C. Kara will definitely want to buy a second slice of pizza.
D. even if Kara buys a second slice, she will not buy a third slice.
Answer: A
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The monopolist's input demand curve is the
A) marginal revenue curve. B) marginal revenue product curve. C) marginal physical product curve. D) marginal factor cost.
Which of the following is part of the synthesis view of fiscal policy?
a. Automatic stabilizers offset some of the fluctuations in aggregate demand without any government action. b. Fiscal policy is much less potent than the early Keynesian view implied. c. The effectiveness of discretionary fiscal policy as a stabilization tool is highly questionable given the difficulties in proper timing. d. All of the above are correct. e. None of the above is correct.