A State of Consumer Equilibrium for Two Goods Consumed Exists

question 50

Multiple Choice

A state of consumer equilibrium for two goods consumed exists when the:

• A) marginal utility of all goods is the same for the last dollar spent on each good.
• B) marginal utility per dollar's worth of two goods is the same for the last dollar spent on each good.
• C) price of two goods is the same for the last dollar spent on each good.
• D) marginal cost per dollar spent on two goods is the same.

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Definitions:

Annual Interest Payments

Periodic payments made to bondholders, typically annually, that represent the interest earned on the investment.

Effective Annual Rate

The real return on an investment, taking into account the effect of compounding interest over a year.

Annual Percentage Rate

The annual rate charged for borrowing or earned through an investment, inclusive of any fees or additional costs.

Periodic Interest

Interest that is paid or calculated at regular intervals over the life of a loan or investment.