In a World with Only Two Goods X and Y,which

question 71

Multiple Choice

In a world with only two goods X and Y,which of the following statements is NOT true when a consumer faces a corner solution and spends all of her income on good X?

• A)The marginal utility per dollar spent on good X is greater than the marginal utility per dollar spent on good Y over the entire amount of her income.
• B)For every consumption bundle on her budget line,the marginal utility of good X is greater than the marginal utility of good Y.
• C)A sufficiently large decrease in the price of good Y,holding the price of good X constant,can result in an interior solution.
• D)The marginal rate of substitution is not equal to the relative price ratio at the corner solution.

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Definitions:

Implicit Memory

A type of long-term memory that enables people to perform tasks without conscious awareness of the previous experiences influencing those actions.

Context-Dependent Memory

The phenomenon where people recall information better when the recall situation is similar to the encoding situation.

Episodic Memory

A form of enduring memory that deals with remembering particular incidents, circumstances, and personal encounters.

Semantic Memory

A component of long-term memory involving the conscious recall of facts, concepts, and knowledge about the external world which is not tied to personal experiences.