If a Commodity Is Inexpensive and Its Total Utility Great

question 131

Multiple Choice

If a commodity is inexpensive and its total utility great,

• A)it is an inferior good.
• B)it is plentiful.
• C)its marginal utility is high.
• D)the ratio of price to marginal utility is very high.

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Definitions:

Output

The quantity of goods or services produced in a given period by a firm, industry, or country.

Multiplier Size

A measure of the impact of fiscal and monetary policies on the national income, showing how initial spending leads to increased total spending.

Fiscal Policy

Government policies regarding taxation and spending that are used to influence economic conditions, including stimulating or restraining economic growth.

Potential GDP

The highest level of Gross Domestic Product (GDP) an economy can sustain over a long period without increasing inflation, reflecting its full employment output.