If Mr Smith Thinks the Last Dollar Spent on Shirts Yields

question 206

Multiple Choice

If Mr. Smith thinks the last dollar spent on shirts yields more satisfaction than the last dollar spent on cola, and Smith is a utility-maximizing consumer, he should

• A) decrease his spending on cola.
• B) decrease his spending on cola and decrease his spending on shirts.
• C) decrease his spending on shirts.
• D) increase his spending on cola and decrease his spending on shirts.

---

Definitions:

Accommodation

In psychology, the process of adjusting existing cognitive structures in response to new experiences; in vision, the process by which the eye's lens changes shape to focus near or far objects on the retina.

Fovea

The central focal point in the retina, around which the eye’s cones cluster.

Iris

The colored part of the eye surrounding the pupil that controls the amount of light entering the eye by adjusting the size of the pupil.

Salvation Army

A Christian denominational church and an international charitable organization known for its thrift stores and charity work.