Figure 21-14

question 395

Multiple Choice

Figure 21-14
-Refer to Figure 21-14. Which of the following statements is correct?

• A)The indifference curves represented in graph a are perfect complements.
• B)The indifference curves represented in graph b are perfect substitutes.
• C)The indifference curves represented in graph c are neither perfect substitutes not perfect complements.
• D)All of the above are correct.

Understand the concept of opportunity cost and how it can be visualized on a production possibilities frontier (PPF).

Recognize the roles of economists as scientists and policy advisers.

Identify the subject matter specialization within economics, e.g., microeconomics and macroeconomics.

Describe the roles and duties of various economic advisory bodies and government offices in formulating economic policies.

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Definitions:

Income

Represents the money received, especially on a regular basis, for work or through investments.

Price of X

The amount of money required to purchase a specified amount of good or service 'X'.

Price of Y

The cost or value attributed to a good or service denoted by 'Y', often set by market demand and supply or by the seller.

Utility Function

A mathematical representation that ranks preferences or satisfaction levels of a consumer for different bundles of goods.