Billy Is Maximizing Utility Subject to His Limited Income

question 85

Multiple Choice

Billy is maximizing utility subject to his limited income. As a result, which of the following statements is TRUE?

• A) The slope of the indifference curve is twice the slope of the budget constraint.
• B) The indifference curve intersects the budget constraint at precisely two points.
• C) The budget constraint is tangent to the indifference curve.
• D) The MRS_XY = P_XP_Y.

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Definitions:

Developmental Sequences

The predictable order in which children typically develop skills or achieve milestones across various domains such as physical, social, or cognitive.

Piaget

A theorist known for his work in developmental psychology, particularly in the study of children's cognitive development.

Moral Realism

The first stage in Piaget’s cognitive-developmental theory of moral development. In this stage, children judge acts as moral when they conform to authority or to the rules of the game. Morality is perceived as embedded in the structure of the universe.

Autonomous Morality

The second stage in Piaget’s cognitive-developmental theory of moral development. In this stage, children base moral judgments on the intentions of the wrongdoer more so than on the amount of damage done. Social rules are viewed as agreements that can be changed.