Mr Cog in Problem 7 Has 18 Hours a Day

question 22

Multiple Choice

Mr. Cog in Problem 7 has 18 hours a day to divide between labor and leisure. If he has 13 dollars of nonlabor income per day and gets a wage rate of 17 dollars per hour when he works, his budget equation, expressing combinations of consumption and leisure that he can afford to have, can be written as

• A) 17R + C = 13.
• B) 17R + C = 319.
• C) R += 421.
• D) C = 319 + 17R.
• E) C = 358 + 17R.

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Definitions:

Partial Equilibrium

An analysis in economics focusing on the equilibrium of a specific sector or market without considering the whole economy.

Equity

The value that would be returned to shareholders if a company's assets were liquidated and all its debts repaid.

Least Possible Cost

The minimum expenditure necessary to achieve a specific outcome or produce a given quantity of a good.

Input Markets

Marketplaces where firms buy resources, goods, and services necessary for producing their own products or services.