The Consumer Optimum (For Two Goods, a and B) Is

question 326

Multiple Choice

The consumer optimum (for two goods, a and b) is reached when

• A) TU_a = TU_b.
• B) MU_a = MU_b.
• C) TU_a/P_a = TU_b/P_b.
• D) MU_a/P_a = MU_b/P_b.

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Definitions:

Normal Balance

The side of the accounting equation on which increases to an account are recorded, typically debit for assets and expenses, and credit for liabilities, equity, and revenue.

T Account

A graphical representation of a general ledger account that depicts how any changes to that account are reflected on the debit and credit side.

Ledger

A book or collection of accounts in which account transactions are recorded.

Trial Balance

A bookkeeping report that lists the balances in each of an organization's general ledger accounts at a specific point in time.