Suppose You Have Spent Your Entire Budget and the Marginal

question 15

Multiple Choice

Suppose you have spent your entire budget and the marginal utilities per dollar spent on all the goods you buy are equal.Which of the following is true?

• A)You are not being rational.
• B)There is a way to increase your utility by reallocating your purchases.
• C)You will reduce your utility if you allocate your income in any other way.
• D)You are minimizing your total utility.
• E)You have chosen a consumption bundle that lies below your budget line.

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.