Suppose a Consumer Knows That at Her Current Bundle, MUx/Px

question 180

Multiple Choice

Suppose a consumer knows that at her current bundle, MUx/Px > MUy/Py. Is this individual choosing a bundle that maximizes utility? ​

• A)​Yes, because this individual values good X more than good Y.
• B)​Yes, because this individual values good Y more than good X.
• C)​No. This individual should shift consumption from good X to good Y.
• D)​No. This individual should shift consumption from good Y to good X.

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Definitions:

Instrumental Values

Core values that dictate how we behave in order to achieve our goals, such as honesty and ambition.

Tangible Values

The measurable and physical worth of an asset, product, or property, which can be quantitatively assessed or directly experienced.

Intangible Values

Non-material benefits or qualities that are valued but not physically touchable, such as reputation, brand value, or human capital.

Corporate Culture

The beliefs, behaviors, values, and symbols that are accepted generally by members within an organization.