FIGURE 3-4 -Refer to Figure 3-4. If the Price of 1-Bedroom Apartments

question 78

Multiple Choice

FIGURE 3-4
-Refer to Figure 3-4. If the price of 1-bedroom apartments in Collegetown were $300, there would be a
Of apartments.

• A) surplus; 100
• B) shortage; 50
• C) shortage; 100
• D) surplus; 50
• E) surplus; 150

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Definitions:

Utility Function

A mathematical representation of how different combinations of goods or services can provide different levels of happiness or satisfaction to a consumer.

Indifference Curves

A graph that represents combinations of goods among which a consumer is indifferent, showing different levels of utility.

L-shaped

Often used to describe demand or recovery curves that have a rapid decline followed by a period of stagnation.

Utility Function

A mathematical representation of how consumers rank different bundles of goods according to their levels of satisfaction.