After Watching a Movie, Alan Chooses to Go for a Walk

question 38

Multiple Choice

After watching a movie, Alan chooses to go for a walk rather than watch a second movie. Economists would explain his choice using the concept of:

• A)budget constraints.
• B)diminishing marginal utility.
• C)income effect.
• D)substitution effect.

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Definitions:

CIFP Course Materials

Educational resources and texts provided for the Certified Islamic Finance Professional (CIFP) program, covering Islamic financial principles and practices.

Compounded Quarterly

In this scenario, interest is applied to the initial sum and any accumulated interest every three months.

Future Value

The value of an investment at a specific date in the future, taking into account factors like interest rates and time period.

Compounded Annually

Interest calculation method where the interest is added to the principal sum once a year, resulting in 'interest on interest.'