If the Graph Shown Represents Celia's Budget Constraint,which of the Following

question 28

Multiple Choice

If the graph shown represents Celia's budget constraint,which of the following must be true?

• A) Celia will spend twice as much on earrings as she does hairbands.
• B) Celia could consume either four pairs of earrings or eight hairbands.
• C) Celia gets twice as much utility from earrings as she does from hairbands.
• D) All of these are true.

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Definitions:

Transferability

The ability of an asset to be transferred or converted easily from one individual to another without affecting its value.

Human Capital

A collection of proficiencies, knowledge, or invisible assets owned by individuals that can be leveraged to bring about economic prosperity for themselves, their work environments, or their community.

Compensating Differential

A difference in wages that compensates workers for undesirable aspects of a job, such as hazardous working conditions or undesirable hours.

Labor Supplied

The sum of hours employees are ready and available to work for a specified pay rate.