The Below Table Shows the Average Utility (In Utils) Obtained

question 48

Multiple Choice

The below table shows the average utility (in utils) obtained from the consumption of goods A and B.Table 7.3

-In economic theory, the idea of the equimarginal principle, or consumer equilibrium, means:

• A)consumers appear to be similar in their buying habits, which explains why prices are almost always in equilibrium.
• B)to maximize utility, consumers allocate all of their incomes among goods so as to equate the total utility of all units of goods purchased.
• C)to maximize utility, consumers must allocate their scarce incomes among only the cheapest products available.
• D)to maximize utility, consumers must allocate their scarce incomes among goods so as to equate the marginal utilities per dollar of expenditure on the last unit of each good purchased.
• E)the marginal utilities among luxury goods are always equal among certain high-income earners.

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Definitions:

Profit Margin

A financial performance ratio that shows the percentage of profit a company makes for each dollar of revenue.

Return on Assets

A profitability ratio that indicates how efficiently a company is using its assets to generate profit.

Return on Equity

An indicator of a company's financial performance that shows the amount of profit generated per dollar of shareholders' investment.

Profitability Index

A financial metric that measures the relationship between the present value of future cash flows and the initial investment.