Assuming Only Two Goods X and Y, If MU_X\P_X =

question 165

Multiple Choice

Assuming only two goods X and Y, if MU_X\P_X = MU_Y\P_Y, then the consumer

• A)is not in equilibrium.
• B)cannot be made better off by redirecting his purchases.
• C)is deriving the same marginal utility on both goods.
• D)has no incentive to consume either good X or good Y.

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Definitions:

Variance

The square of the standard deviation, indicating how much the values in a set vary from the mean.

Prediction Interval

A range of values that is likely to contain the value of an unknown parameter for a given level of confidence.

Confidence Interval

A range of values, derived from sample data, that is likely to contain the value of an unknown population parameter with a specified level of confidence.

Regression Line

A line of best fit through a scatter plot of data points in statistical analysis, showing the relationship between two variables.