When Income Is Allocated to Two Goods, X and Y

question 22

Multiple Choice

When income is allocated to two goods, x and y, consumer equilibriumoccurs when

• A)MUx = MUy
• B)MUx = MUy, and the budget is exhausted
• C)MUx/Py = PUx/Py
• D)MUx/Py = PUx/Py, and some money is not spent
• E)MUx/Py = PUx/Py, and the budget is exhausted

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Definitions:

Depreciation

The systematic allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value due to usage, wear and tear, or obsolescence.

Office Equipment

Tangible assets such as desks, computers, and printers used in the operations of an office.

Production Equipment

Tools or machinery used in the manufacturing process to create products.

Depreciation

The accounting method of allocating the cost of a tangible asset over its useful life, reflecting its decrease in value over time.