Which of the Following Statements Is FALSE

question 435

Multiple Choice

Which of the following statements is FALSE?

• A) A consumer has only one indifference curve.
• B) A consumer possesses a preference map.
• C) An indifference curve is a curve that shows the combination of goods among which a consumer is indifferent.
• D) The marginal rate of substitution is the rate at which a consumer will give up good y to get more of good x and remain on the same indifference curve.

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Definitions:

Nominal Dollars

Nominal dollars refer to the amount of money expressed in current values, without adjustment for inflation, representing the "face value" of currency.

Fixed Incomes

Fixed incomes refer to types of investment that pay regular interest or dividends to investors and have the principal amount returned at maturity.

Nominal Interest Rate

The interest rate before adjustments for inflation, representing the face value of borrowing costs or investment returns.

Relative Prices

The price of a good or service compared to the price of another, indicating the trade-off between choosing one over the other.