To Resolve the Paradox of Value,you Must

question 5

Multiple Choice

To resolve the paradox of value,you must

• A) compare price elasticities of demand across goods.
• B) distinguish between marginal and total utility.
• C) sacrifice efficiency.
• D) minimize consumer surplus.
• E) distinguish between marginal utility and price.

---

Definitions:

Consumer Surplus I

The gap between what consumers are prepared and able to spend on a product or service and what they end up paying.

Price

The amount of money required to purchase a good or service.

Comparative Advantage

The ability of an individual, firm, or country to produce a good or service at a lower opportunity cost than other producers.

Absolute Advantage

Refers to the capability of an entity to produce a good or service more efficiently than its competitors using the same amount of resources.