Exhibit 6A-2 Consumer Equilibrium

question 49

Multiple Choice

Exhibit 6A-2 Consumer Equilibrium
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-Given the budget lines and indifference curves shown in Exhibit 6A-2, point D yields:

• A) more total utility than point A.
• B) more total utility than point E.
• C) less total utility than point F.
• D) less total utility than points B, F, and C

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Definitions:

Compounded Monthly

Calculating interest on a principal sum along with any accumulated interest of the previous periods with each cycle occurring every month.

Trust Fund

A legal arrangement where assets are held by a trustee for the benefit of another person or group.

Compounded Monthly

A method of calculating interest in which the interest earned each month is added to the principal, and the following month's interest is calculated on the new total.

Perpetuity

A financial instrument that pays a fixed amount of cash flow indefinitely.