A Consumer's Optimum Is Found When

question 218

Multiple Choice

A consumer's optimum is found when

• A) the marginal utility of the last dollar spent equals zero for each good.
• B) the marginal utility of each good is increasing and the total income is spent.
• C) the total utility of each good is the same and the total income is spent.
• D) the marginal utility of the last dollar spent on each good is the same and all income is spent.

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Definitions:

Capital Goods

Long-lasting goods used in the production of other goods or services, such as machinery, tools, and buildings.

Consumer Goods

Finished products consumed by individuals or households to satisfy their immediate wants or needs, such as food, clothing, and electronics.

Limited Partnerships

A form of partnership consisting of one or more general partners, who manage the business and assume legal debts and obligations, and one or more limited partners, who are liable only to the extent of their investments.

Corporate Income Taxes

Taxes imposed on the net income or profit of corporations, calculated after deducting expenses like cost of goods sold and wages.