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Which of the Following Statements Is Most True

question 16

Multiple Choice

Which of the following statements is most true


Definitions:

Inferior Good

A type of good for which demand decreases as the income of the consumer increases, due to the availability of more desirable substitutes.

Diminishing Marginal Utility

The principle that as a person consumes more of a good, the satisfaction gained from consuming an additional unit decreases.

Comparative Advantage

The ability to produce a good at a lower opportunity cost than others can produce it. Relative costs determine comparative advantage.

Marginal Utility

The additional satisfaction or benefit a consumer receives from consuming one more unit of a good or service.

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