Marginal Utility Theory Predicts That When the Price of One

question 291

Multiple Choice

Marginal utility theory predicts that when the price of one good rises, the demand for another good is a substitute increases. This change occurs because of

• A) an increase in the marginal utility per dollar from the substitute good.
• B) an increase in the marginal utility of the substitute good.
• C) a decrease in the marginal utility per dollar from the good whose price has risen.
• D) a decrease in the marginal utility of the good whose price has risen.

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Definitions:

Day Of Infamy

The "Day of Infamy" refers to December 7, 1941, when Japan launched a surprise attack on Pearl Harbor, leading to the United States' entry into World War II.

Pearl Harbor

The site of a surprise military attack by the Japanese Navy against the United States naval base at Pearl Harbor, Hawaii, on December 7, 1941, leading to the U.S. entering World War II.

President Roosevelt

A reference either to Franklin D. Roosevelt, the 32nd President of the United States who served during the Great Depression and World War II, or Theodore Roosevelt, the 26th President known for his progressive policies.

United States

A country in North America composed of 50 states, a federal district, five major self-governing territories, and various possessions.