If a Consumer Buys Two Different Goods, the Rational Spending

question 110

Multiple Choice

If a consumer buys two different goods, the rational spending rule requires that the:

• A)total expenditure on the two goods be equal.
• B)ratio of total utility to price be equal for the two goods.
• C)ratio of average utility to price be equal for the two goods.
• D)ratio of marginal utility to price be equal for the two goods.

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Definitions:

Diaphragms

Barrier contraceptive devices placed inside the vagina to prevent sperm from reaching the uterus.

Bacteria

Microscopic, single-celled organisms found in virtually all environments on Earth, which can be beneficial, neutral, or harmful to humans and other organisms.

Prostatitis

A painful condition that involves swelling and inflammation of the prostate gland.

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Typically refers to adult males who are significantly younger than their partners or counterparts in a given context.