If the Combination of Two Goods Is a Point of Tangency

question 189

Multiple Choice

If the combination of two goods is a point of tangency between the budget line and an indifference curve, then:

• A) consumer equilibrium has been achieved.
• B) some available income has not been spent.
• C) utility can be decreased by consuming more of both goods.
• D) utility can be increased by consuming more of one good and less of the other.

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Definitions:

Positive Punishment

Adding an unfavorable outcome or consequence after an undesired behavior to decrease the likelihood of that behavior occurring again.

Negative Punishment

A behavior modification technique involving the removal of a desirable stimulus to decrease the frequency of a behavior.

Associative Learning

A learning process that involves connecting a stimulus with a response or connecting two stimuli together.

Observational Learning

A learning process where individuals change their behaviors or acquire new skills by watching and imitating others.